Cryptocurrencies might have started with Bitcoin in 2009, but
they have grown from that cryptocurrency to altcoins like Ripple,
Ethereum etc. Blockchains have a lot of features and are key
in various industries. Even with the transparency, security and
innovative features that blockchains offer, there are still some
problems with the blockchain technology.
The existing blockchains have to battle with security, in the form of
classical and quantum computing hacks. Most blockchains expose
users’ private information, thereby defeating privacy issue.
Though transparency is seen in blockchains, more can be done in
that aspect. Decentralization is the keyword in blockchains, but are
existing blockchains really decentralized? Do users have rights?
Many Cryptos that use masternodes have their block reward split
among both the masternode and mining systems. This distribution
method has an intended fairness scheme, but it gets circumvented
by the increase in masternodes which are held by large investors.
This might likely lead to centralization like in the case of the main
shareholder in a firm.
Masternodes’ benefits can go on to reducing those who use Proof of
Stake (PoS) mining, thereby reducing the PoS network’s security.
Though masternodes are invaluable, we do not reward them in a
way that it will exceed the value they give. If we did, the owners of
the masternode will benefit more than other system’s users, and this
will ultimately lead to centralization.