VaporNodes is yet another node protocol that has been around since Christmas in 2021. It has had a real rollercoaster ride since then and the price has moved between $0.001 per VPND token and $0.1 at the peak. But, what is VaporNodes and is it worth investing in the protocol? How does it work? How can you generate passive income with VaporNodes?
VaporNodes is running on the Avalanche blockchain and it is very easy to use. In fact, it is somehow easier to use and to get started with than most other node protocols like Thor Financial and PowerNodes, because all you have to do is to create a node with your tokens and the job is done. You do not have to worry about different kinds of nodes with different reward levels. The minimum requirement is 1000 VPND to create a node, but if you own 50,000 VPND tokens, you can create one node with those. There is no goal in itself to create a lot of nodes, because that will only cause more transaction fees. So, it is much better to just create one VaporNodes node with 100,000 VPND than to create 100 nodes using the same amount. In that way, VaporNodes is actually much more similar to Louverture than it is similar to Thor Financial, PowerNodes, Comb Financial, Cubo Finance, and several others.
Currently, VaporNodes is operating with a daily ROI of 1%, meaning that it will take you 100 days to earn back your initial investment (in VPND tokens). If the Dollar value of the token will drop in the same period, it will take a longer amount to actually reach your return of investment (in USD), but if the price should increase, then it will go faster.
If you take your rewards and compound them, your node size will grow which also means that your daily rewards will grow. What you had used to create a node or when you compound your rewards, they will “be lost”, but as your node is growing, the future daily rewards in VPND will grow in size so whenever you should decide to claim your rewards in the future, you will see a higher number of VPND tokens generated per day (due to the increased size of your node).
There are all sorts of mechanisms in the protocol, for example, the principle of Diamond Hands.
- Level 0: Rewards within the first 3 days gets no boost
- Level 1: Rewards not claimed for 3 days gets a x1.05 boost
- Level 2: Rewards not claimed for 7 days gets a x1.2 boost
- Level 3: Rewards not claimed for 15 days gets a x1.4 boost
This is a system that encourages people to keep their rewards stored on the platform for a longer time, instead of claiming every single day.
There is also a 10% Claim Tax meaning that whenever you claim your rewards, 10% will be “taken” as a claim tax.
- You can find even more detailed information about VaporNodes and how it operates in their official docs.
Should you invest in VaporNodes?
What makes VaporNodes better than Phoenix Community Capital, Thor Financial, Comb Financial, Louverture, and the others? To be honest, it is hard to say. They have a nice-looking website, and they have a lead developer who is very visible and not hiding (@MejiasDev). That for sure comes as a big positive.
They have done quite a lot of investments in other protocols using the funds in the treasury. As a result, the protocol owns several StrongBlock nodes, quite a lot of CVX tokens, lots of Sushi tokens, an AVAX validator node, and also a GALA node license.
To be honest, this is a project that has potential, but we don’t see a lot that tells us that this will perform way better than all the others. The leading developer for sure brings credibility to the project, and that might be what might tip the odds in favor of VaporNodes.
Currently, the price of 1000 VPND tokens (the minimum required in order to create a node) is $35, meaning that there is a very low risk involved here. Of course, the gains won’t be as big with a small order like that, but it still makes it a very low-entrance project (compared to Phoenix Community Capital currently requiring an investment of more than $5500 in order to create your first nest). One StrongBlock node currently costs you $2500, which once again shows us that VaporNodes has a really low entrance fee.
What is the conclusion?
We would never FOMO in on VaporNodes, but if you have looked at the charts and feel like doing an investment, feel free to do so. It has potential, just like the other node protocols, but we don’t see a lot that makes it stand out in the crowd.
How to buy VPND and create a node?
It is really easy to buy VPND tokens and to create a node.
- First, you need to have a MetaMask wallet installed on your device (we recommend that you use it together with a hardware wallet like Trezor or a Ledger).
- Make sure to run your MetaMask wallet on the Avalanche network (add the network if it isn’t there already).
- Buy some AVAX tokens on Kucoin or Binance (or somewhere else) and send them with a C-Chain transfer to the address of your MetaMask wallet. It is always recommended to do a test transfer with a small amount first to make sure that everything works properly before you send the big amount.
- Go to TraderJoe and buy your VPND tokens. Do not forget to leave some AVAX in your wallet which is required to pay for future transactions on the blockchain.
- When you have bought the tokens, return to the VaporNodes Finance website.
- Click the nodes button and create your first node.
- Give your node a name, choose the number of tokens to add, and if you use one of the links in this article, feel free to leave us as a referral as you register.
- Click the continue button. This will first start one transaction on the blockchain (to approve you spending your VPND tokens) and the second will actually register your node. After the second transaction, your node will be created.
Above you can see that the IP Address Guide node is registered on the VaporNodes Finance website. Now it is just to let the tokens work, and hopefully, it will turn into a stream of passive income in the coming weeks, months, and years.
That’s it! We have now shared some thoughts about VaporNodes Finance and we have also shown you how to create your first VaporNodes node. Are you going to create a node? Have you created a node already? Are you satisfied? Are you happy? Are you worried? Or do you have any questions? Please use the comment field below and let us hear from you!