Complete Masternode setup guide

Complete Masternode setup guide

What is a masternode?

A masternode is a full node or a cryptocurrency wallet that is fully synced on the blockchain of whatever coin you choose with MN function availability and is always running 24/7 , also called Hot Wallet. The masternodes increase privacy of transactions (especially instant transactions), allows to participate in the future of projects through governance and votes and enable budgeting and treasury system in cryptos. Masternodes are a mean of passive crypto income when most people lack time to do active trading. It also allows users to be completely actor of a project and its ecosystem by improving the network every day.

Advantages

Security:

Masternode needs a static IP address and they need to run without any interruptions. Most home computers are connected to dynamic IP address and most home broadband connection are not as stable as data centers. If the IP address changes or if the network connection goes down then your node needs to start over which as a result you lose payments. This is one main reason why you need to setup and host masternode on a VPS. By hosting a masternode locally the IP address of your computer gets exposed to all over the Internet. By exposing your network you are not only putting your coins at risk but you are risking other personal data that are in that system. By using a VPS solution, you ensure your coins are safe and secured if you use the hot/cold configuration.

Complete control:

When choosing a VPS, you have full root access to the server you picked. With root access, you have complete control over the server environment to tweak it precisely for your needs. If you need a custom software package installed or port opened, you can do so without having to wait for your hosting provider to support it. In case of a self-installation at home ,the possibilities are the same but the security issues are still present and put your datas at risk. The biggest risk at home is if someone gain access to your personal network and then your root access to the masternodes. Visit https://mastersofnodes.com/cryptocurrency-mining-is-it-worth-the-effort-today/ to read about Cryptocurrency Mining – Is it Worth the Effort Today?

Ecology and Resources:

With a VPS hosting solution, a large dedicated server is sliced or divided into different virtual environments. This way, more people share the resources of that physical server and allow the resources to be optimally used. In that way , users carbon footprint is as little as possible and ensure the minimum impact on our planet.

Setting up a masternode at home can consume a lot of energy and resources which could be optimized and limited with a professional VPS provider.

A scaling configuration:

When you host a masternode with a VPS your environment is hosted within what is called a container. This container is allocated a certain amount of resources depending on the package you purchased. The great thing about how these containers work is that they can easily and quickly be allocated more or less resources as you need them. This is done really quickly by the provider, ensuring the minimum downtime possible and limiting losses for your income.
If you need to upgrade your ram or CPU quickly when you feel the need, you can simply add more resources to your container in a few clicks. If you were using a home hosting, you would have to physically install the new equipment into your server – which would result in a downtime and then less rewards.

Cost Savings:

VPS hosting solutions are much less expensive now than they were only a few years ago. With advances in virtualization technologies, the prices are only expecting to decrease. It is now easy to afford for a VPS solution instead of a local installation. The electricity used to run a server 24/24 7/7 is less important and more optimized with a VPS provider than at home. The cost for maintaining the masternode up in case of a failure can be expensive if you must change the entire system yourself. The professional services of a VPS provider guarantee the minimum downtime and an efficient user-support.

The main drawback

While using a VPS system is the best solution for your masternode hosting, the main drawback of both VPS and local installations is the technical knowledge required.

Masternodes are blockchain-based nodes and require a minimal technical knowledge to setup and successfully run one. For non-techies or beginners, it might be tense or hard to learn basic information to setup a masternode easily. By chance, many project teams are now building one-click-scripts which install all the components needed and only require owners to input the correct data such as external IP, masternode private key and outputs etc.

How-to setup a masternode (complete technical guide)

This document is a guide for setting up a general masternode using the so called hot-cold set up. For compatibility reasons, we will use a VPS with Ubuntu 16.04 for the remote masternode while keeping the collateral coins safely in the local wallet (The local wallet can be stored on a VPS too or directly on your computer). The Ubuntu 16.04 version is stable and includes all the elements to run a basic masternode properly. You can set a masternode on your local machine, but this is less convenient, less economical and less secure, and therefore not recommended in any way (You can find more information on the pros and cons in the previous part) . 

This guide was written using a system with 1GB RAM based on Ubuntu 16.04 VPS on IPv4. This detailed guide shows how to install a masternode manually. It is still possible to use install scripts to avoid learning some technical knowledge or use a 3rd party to completely manage and host your node. These scripts are often made available by the different teams and simplify the complete process of masternode setup from scratch. In the guide , we will be using “ProjectCoin” as a generic term to replace possible real projects names and the files associated.

Step 1: VPS Server Deployment (Hot Wallet)

This first part presents how to run a Linux Ubuntu 16.04 virtual private server (VPS) that will function as a masternode. This part is called the hot wallet because it must stay online & process transactions 24/7. The best way to do this is by using an existing VPS provider. In the current crypto market, there is a lot of competitors with different offers. The two most affordable and reliable are Vultr & DigitalOcean , offering basic offers and features from 2,50$ /month. The Ubuntu distribution with version 16.04 is the most reliable and easy to use for the current masternode market. The technical possibilities fit with the need related the masternodes setup.

A) Ubuntu Server Acquisition

The process to buy a VPS to host a masternode is simple. You’ll need to put in payment information, but you won’t actually be charged until you deploy your first server. The servers have a monthly fee around 2,5$-$5/month. After finishing the registration process on your chosen platform, go on your general VPS dashboard. For the technical part, we need a server based on IPV4 (not IPV6) with 1GB Ram and Ubuntu 16.04 installed on it. The storage space must be enough to handle backups if you wish to do some automatically with your provider or the data that will be stored on the server later on.

You can select any Server Location you want. For the server type, select Ubuntu 16.04 x64. The smallest server $5/mo. will work but, in some cases, we might need to setup a memory swap to avoid excessive resources consumption. Once the server is fully prepared by the provider, you’ll be able to launch it for the first time. You can set a label to recognize a specific MN/Server in case you have several MN installed on the same provider. You can keep the server information page open as we’ll need it to set up the server with the root access and the external IP address.

B) Server deployment

We need to login to our new VPS server and download the wallet, but first we need to access it. There are various programs to access Linux VPS machines through SSH, but we will be using Putty for ease of use. Go to the Putty website and download and install the latest client. Install and run Putty. Now we need to enter the VPS credentials to login. The default username is root. The password will be often made available directly on the VPS overview or sometimes sent by mail after the server purchase.

Download Putty: https://www.putty.org

Technical preparation:

Masternodes setup can be tricky without technical knowledge. In fact, the basic server configuration to host a node is the same and can be replicated (with snapshot) and used by different masternodes. Usually, the changing part is the configuration associated to a specific currency which could require some changes.

For the following, we consider that the masternode’s owner is logged in root on the VPS. In our case, using a low memory server, we need to set up a swap file. For reminder, a Swap is a space on a disk that is used when the amount of physical RAM memory is full. When a Linux system runs out of RAM, inactive pages are moved from the RAM to the swap space. … In most cases when running Linux on a virtual machine a swap partition is not present, so our only option is to create a swap file.