Introduced as a form of electronic cash, Bitcoin (Crypto: BTC) created an entirely new kind of asset class when it was released as open-source software in 2009. Very few heard of this new invention until the price and usage of Bitcoin skyrocketed late last year. However, the sudden spike of demand made it clear that Bitcoin wasn’t capable of processing mass amounts of transactions. Some waited as long as a day or two for a single transfer to complete while transaction fees reached past $50.
While the incredibly slow transaction times and high fees took many of the headlines when Bitcoin’s challenges came to light, there were other opportunities identified for improvement as well along the way.
Advancing Blockchain Innovation with Masternode Technology
In 2014, Evan Duffield came up with the idea of adding a second-tier of features on top of the standard mining network put in place by Bitcoin. This novel idea led the creation of Xcoin, which is now known as Dash (Crypto: DASH). The most valuable features introduced as a result of integrating masternode technology include reducing transaction fees to nearly zero, allowing for virtually instant transactions to take place as commonly expected from Visa (NYSE: V) and Mastercard (NYSE: MA) credit cards, enabling decentralized governance and voting, and creating a self-sustainable treasury system so a portion of the block rewards were available to fund ideas presented by the community.
The foresight Evan had to create a decentralized payment network that is fast, high-capacity, secure, inexpensive and self-funding four years ago is nothing short of incredible. Similar to Bitcoin, though, few people really noticed the brilliance of the new technology until a much later time. Of course, it didn’t take long at all for Dash to come into the spotlight when it became clear Bitcoin wasn’t viable for everyday usage by millions of people with its current framework.
Today, Dash is one of the most traded cryptocurrencies in the global market. But fast and cheap transactions is only part of the story. Accelerated innovation has taken place because of how quickly network consensus can be reached through the decentralized governance system. In an article published during the recent crypto craze, Dash Core CEO Ryan Taylor said the last network only took 100 hours to reach 99% network consensus, compared to the months it typically takes even non-contentious changes to roll out on other networks.
One of the World’s First-Ever Cryptocurrencies Integrates Masternode Code
The beauty of open source technology is that it can be easily installed in other frameworks. This includes blockchain-based platforms as well. When Dash’s masternode code was added to Terracoin (Crypto: TRC) last year, it became the oldest masternode cryptocurrency. Created on October 26, 2012, Terracoin will have its 6th birthday this week. Today, it stands as one of the few original crypto-assets that still exist and is arguably advancing a lot faster than other blockchains of its time.
Decentralized governance was the main purpose for adding the masternode code to Terracoin, but it also better equipped the community to deliver on its mission to “help the world” with crypto technology. The self-funding part of the code began allocating 10% of the block rewards to a communal budget that can be directed towards philanthropic purposes through masternode voting, as well as improving the coin in other ways (which, in turn, allows the community to better aid charitable causes in the future). Plus, the code split the remaining 90% of the block rewards between miners and masternode owners, allowing individuals to donate masternodes to an organization of their choice so residual payouts can continually support their initiatives. This splitting of the block rewards also incentivized existing and new community members to support the masternode network necessary for adding the second-tier features.
In February of 2016, The Terracoin Foundation was incorporated as an independent organization to take the decentralized community’s mission further and ensure stable development. To date, enough Terracoin has been donated to this foundation to create more than 15 masternodes. Once a certain objective is met, half of the service rewards generated from supporting the network will be donated to the organization(s) decided upon by members of the community. The other half of the net profits will be used to create more foundation-owned masternodes to increase the amount that can be donated each month.
Looking to the Future
Even though cryptocurrency has been around for nearly a decade now, the technology is still very young and we still don’t know what future challenges lie ahead. This is why the masternode concept is so crucial as it helps ensure decisions are quickly made so development continues and progress isn’t impeded.
Since Terracoin was adopted by the foundation nearly 3 years ago, a lot of work has been done to ensure long-term success. During the past two years, the community leaders have added merged mining, decentralized governance, masternodes, dark gravity wave difficulty recalculations and more.
Terracoin developers even further improved on Dash’s technology by making voting easier than ever with the ability to easily create proposals within the desktop wallet and vote on proposals submitted by others. This was a huge leap forward compared to using a command prompt, which many mainstream audiences find intimidating. Users can also use the intuitive online services website to monitor the donated masternodes, view earnings statistics on the service reward payouts generated by masternodes they run themselves, see the latest news posted by the founder of The Terracoin Foundation, and much more. Other tools that have been introduced over time make advanced statistics on the network itself highly transparent.
Becoming Part of the Community Yourself
The Terracoin community is enthusiastic about welcoming newcomers. The more people who take an interest in Terracoin, the more effective the coin will be in accomplishing its mission. Anyone with ideas, suggestions, or proposals are encouraged to reach out on Mattermost, Telegram or Discord.
To learn more about Terracoin, visit: https://terracoin.io
To view an interactive flipbook and learn how to engage with the community, visit http://www.blockchainrelations.io/clients/terracoin/flipbook/