Masternodes are trusted nodes that secure the network through transaction and block verification.
These nodes are considered as trusted nodes because, in order for them to receive rewards for the work that they do, collateral is required.
For DAPS, the collateral required is 1 000 000 DAPS.
While Masternodes cannot mint a PoS block – this is done by Staking nodes – they do assist in the verification of transactions contained in the block and the block itself.
For this work, they are rewarded with a block reward. The reward system uses a queue with a FIFO (First In First Out) mechanism that means that all Masternodes are eventually paid out.
Each Masternode that receives a reward, goes to the back of the queue to wait for its next reward. These rewards are guaranteed.
New Masternodes added to the network also join at the back of the queue.
The DAPS Masternode system is modeled after the PIVX Masternode system.
This has many bonuses, including preventing a 51% attack unless both Proof-Of-Stake and Masternode layers are compromised simultaneously.
The See-Saw Balance Reward System has a 60/40 MN/PoS reward split balancing to a maximum of 40/60 MN/PoS reward split.
This gives a fair reward to holders.