A very distinctive feature of cryptocurrencies that has led to mass adoption is the ability for users to experience a total online economy that includes incentives for participation in the industry.People receive incentives in the cryptocurrency industry through mining, staking and owning masternodes. The problem with these forms of providing incentives is the entry barrier which is mostly not favorable for people from emerging markets which might probably be the biggest market for cryptocurrencies.
For instance, mining has a very high entry point with most currencies now requiring a dedicated device called a miner which can be very expensive. Aside from that, miners must also keep devices online at all times which requires 24/7 internet connection and electricity supply.
In most emerging markets, electricity is mostly interrupted and costs a lot for activities such as mining. Internet connection also posses as another huge entry barrier for people in emerging markets who want to mine cryptocurrencies since internet packages are mostly expensive and not very stable.Let’s take Africa for example, research has shown that prices for internet packages are high, sometimes as expensive as $35 per gigabyte. In an emerging market, $35 is a lot of money that can be used for other urgent needs.
Masternodes, on the other hand, are less expensive than mining but also come with a considerable cost that is also not favorable to many. It costs about $5 or a little less per month to run a masternode. Relatively better than mining but still requires a considerable amount of investment that could be an entry barrier for some.
Staking usually requires nothing, aside from the user having to keep his wallet open (online) throughout to confirm transactions. As we have already mentioned, internet packages are not cheap in emerging markets meaning it already costs a lot for normal usage to add the burden of having to stay online at all times to it.
Cold Rewards — A better option?
Now that we understand that not everyone is fortunate enough to have access to high-end devices and services that allow them to reap the benefits of cryptocurrency rewards at the moment, the lingering question is, how does one solve this?DeVault has developed a solution called cold rewards.
Basically, a concept built off staking but is different from staking. First off, cold rewards play absolutely no role in confirming transactions on the DeVault blockchain. Only miners perform that function in the DeVault ecosystem.Secondly, cold rewards do not require users to keep their wallets open at all times like staking. So what exactly are cold rewards then?Cold rewards is a rewards system that provides an incentive for users that hold their coins for about a month.
Basically, if a user keeps his coins in his wallet for about a month, the user gets rewarded for HODLing.According to information from the community Discord, the minimum coins a user must hold is 1,000 DVT to receive rewards.
Reward timeline also defers depending on the number of coins one holds. For instance, a person with 1,000 DVT will receive rewards every 4 months while a person with 4,000 DVT will receive rewards every month.In this system, users do not need to get any extra hardware or commit to any further costs. They get to use their cryptocurrency like they normally do, hold some and get rewarded for it.
This is a huge breakthrough in cryptocurrency rewards as it removes the various entry barriers required to benefit from cryptocurrency incentives, opening it up to a wider range of people, especially from emerging markets.
You can visit this link to learn more about cold rewards.
This article was a submission for the DeVault Economy Article Bounty, visit www.DeVault.cc 1 to learn more about the community governed digital economy.