The team at Zaimirai remains bullish on blockchain and cryptocurrency. Some of us started early, while others held back to see if it was a flash of technology or a sustainable ecosystem. One of our principals — Patrick Quinn — even put skin in the game “before it was cool” with a proof of stake in Dash. So as true believer, we wanted to share some of our insights. Here are five things to consider before investing in Dash masternodes.

1. It’s a longer term investment.

Masternodes aren’t a tool for day traders. If your mindset is in making a cryptocurrency investment, then you probably agree that crypto represents a new asset class. The knock on cryptocurrency is that it’s volatile, so if your appetite doesn’t support swings in pricing, you won’t want to HODL with a masternode. Proof of Stake (POS) is a long-term investment strategy, so carefully consider your investment horizon before buying 1,000 Dash and parking in a wallet attached to a masternode. One other note about crypto investing in general — especially when it comes to masternodes, it’s a viable investment hedge. Not only can you lock in gains, but you earn rewards either way. At ~6% annual return on being a masternode owner, you hedge nicely.

2. You have to be able to manage your appetite for destruction.

Don’t invest in cryptocurrency if you cannot afford to lose principal. HODLing is fraught with cortisol-drenched days, watching the price of your Dash drop precipitously for no apparent reason, only to see it rebound a couple of days later. If you understand your horizon and the volatile nature of this industry, you’ll fare better emotionally. We intend to write more later about trend following, but put a pin in that thought — there are many ways to buy into Dash when it is poised to make gains, protect yourself on the downside, and lock in gains on the upside.

3. Keep an eye on the platform.

Before investing in any cryptocurrency, take a look at the product roadmap. Are there planned features that show a path to growth and higher adoption? Are there regular updates pushed out for testing and production, or do you hear crickets from the development team. Ideally, there’s transparency, making it easy to see progress. And with that, you’ll typically find a vibrant participatory community that points out trends, trumpets successes, and helps guide the direction of the ecosystem. We see this kind of community with Dash, and the way Dash proposals work reinforces it.

4. Calculate the potential return.

Time is one horizon, and perhaps principal growth is another. If you look at a cryptocurrency’s price history, you’ll get a sense of how the market trends. Are you buying at a peak, a valley, or somewhere in between? If you’re buying at an all-time high (ATH), you may be “the sucker at the poker table” or maybe the trend is truly bullish and it continues to rise. Principal is at risk, as already described, but not only could you make gains, with a masternode, you can earn rewards. What is the volume? What is the cost of running the masternode? Does it generate enough of a return to keep you happy?

5. Understand your skill level with technology.

Setting up a Dash masternode is quite hands-on. You need to understand virtual servers, operating systems, remote systems management, and a little security. Whether you have limited IT experience or are an ubergeek, be sure to look over the Dash masternode requirements to see if you have the right skills. If not, consider outsourcing to a hosting provider like Zaimirai who offers a turnkey solution where you don’t have to get your IT hands dirty.

Investing in Dash Masternodes

The $116,740 question (based on today’s Dash price!) is whether it’s a good time for investing in Dash masternodes. We encourage running Dash through this 5 point litmus test yourself. We’ve HODLed through some of the peaks and valleys — we all much prefer the peaks — and cryptocurrencies like Dash survive & thrive when they have a clear purpose, a strong platform, and a supportive community. And yes, we look at these same criteria for our investment.