Tomochain’s so-called staking wars have intensified as potential masternode operators go head-to-head for dominance on the new network. Marketing campaigns and staker recruitments have become more brazen as more operators realize the potentially lucrative benefits of being voted a masternode.
TomoChain, the public EVM (Ethereum Virtual Machine) compatible blockchain, is starting to gain traction with users and developers across the world. Driving this adoption is the platform’s underlying incentive system that promises higher returns for those willing to stake their crypto assets.
The project’s unique proposition is the lower transaction fees, faster confirmation times, and easy compatibility with Ethereum’s so-called “world computer.” This unique advantage is made possible by an innovative consensus mechanism known as a Proof of Stake Voting (PoSV).
Unlike traditional proof-of-stake (PoS), PoSV realigns incentives for users to create more value for those who stake their assets to validate blocks. This bolsters the security of the platform and makes near-zero transaction fees and 2-second confirmations possible.
The PoSV architecture relies on a group of 150 maternodes. Masternodes can create, verify and validate new blocks on the platform. In return, the operators of these nodes are rewarded handsomely.
Their rewards and status as a masternode is determined by an on-chain voting system where ordinary voters can support their favorite masternode operators. Anyone with TOMO coins can stake their assets to vote for a masternode and get a proportion of the rewards in return. These stakers can also pull their vote if a masternode underperforms and doesn’t offer the return-on-investment (ROI) they were hoping for.
Ordinary stakers need to deposit a minimum of 100 TOMO ($5.32) to start voting. Meanwhile, masternodes need to deposit a bond of 50,000 TOMO ($26,607.01) and garner a minimum of 157,132 TOMO ($83,616.22) worth of votes to be considered. When a block is verified by a masternode, they get to keep the majority of the reward depending on the total number of votes, with the stakers splitting the rest proportionally.
By the hierarchical nature of the Tomochain platform, being a masternode is always more lucrative and powerful than being an ordinary staker. According to data from StakingRewards.com, the average TOMO staker can expect an annual yield of 9.2% at current prices. It’s fair to say masternode operators expect a higher yield.
This means there is intense competition for those limited 150 masternode positions on the network. Getting the most votes is critical and some operators have been aggressively seeking out stakers to back them. Marketing and direct recruitment strategies on platforms like Telegram have become so contentious that some users have started calling it a “staking war.”
Nevertheless, confrontations and competition are a natural consequence of the tight incentives structure built into the Tomochain platform. Their modifications to the traditional PoS consensus mechanism that avoids the compromises of low transaction speeds and high costs. The novel mechanism also allows for on-chain governance that’s more transparent and a double validation system that’s more secure.
Above all else, the Tomochain mechanism allows stakers and masternode operators a chance to garner higher economic rewards. This dramatically boosts the chances that early adopters of the platform could beat the wider crypto bear market and experience better investment performance over the long run.
Since the mainnet was launched in December, 2018, the price of each TOMO coin has already tripled. If the consensus mechanism holds up as planned, it could have much further to go.
The ongoing staker wars is a natural consequence of Tomochain’s innovative approach to incentives. Rather than a hurdle, this competitiveness displays the effectiveness of the new PoSV framework. If the momentum of user and staker motivation endures, TOMO hodlers could be in for a windfall.