SALT, the leading provider of large crypto-backed loans for cryptocurrency holders, today announced its partnership with NODE40, the blockchain masternode hosting and monitoring provider. The partnership will provide expanded loan options for DASH masternode owners in tandem with the Dash community’s first masternode hosting service.
Given its long-term viability, its numerous use cases, and its level of adoption, Dash is an appealing collateral form for SALT’s platform. In an April 2019 announcement, SALT affirmed its commitment to support the Dash community and its mission, and noted its respect for Dash’s two-tier network that uses masternodes to maintain the viability of its blockchain.
“Our development team has made a technological breakthrough and has advanced our mission by unlocking value and liquidity in cryptocurrency assets through collateralizing the Dash connected to masternodes,” said Rob Odell, VP of Product and Marketing at SALT. “Dash has quickly become our second most popular collateral option behind Bitcoin and the community has reacted positively with a high volume of loan applications. We’re excited to work with NODE40 to increase our support for the Dash community and provide innovative solutions and services for masternode holders to get the most out of their assets.”
A Dash masternode serves to expedite transactions and scale the network by relaying them over a second-tier network. While Bitcoin’s second layer is an off-chain solution to scale, Dash runs an on-chain second layer using masternode operators who are incentivized by the network like miners in Bitcoin. In March 2015, NODE40 was the first company to provide network infrastructure to host masternodes. According to dash.org, each masternode pays out approximately six Dash (currently just over $1,000 USD) per month in mining rewards.
“Our companies’ shared dedication to customer service naturally brought us together when a mutual client wanted to take out a fiat loan using their masternode’s Dash. What attracted us to SALT was the caution with which things are done; they have a solid reputation of doing things by the books,” said Perry Woodin, Co-Founder and CEO of NODE40 and a Dash Trust Protector. “Having been a part of Dash from early on, we tend to do things conservatively, and that was important to us when evaluating how a loan is backed and if our customers would be protected in the case of an audit. With SALT we share the vision of being cutting edge while playing by the rules not only to protect ourselves, but to bring legitimacy to the industry.”
DASH holders must prove ownership of 1,000 DASH to obtain masternode status and have the right to vote on treasury proposals and receive recurring payouts. However, if at any point, the Dash is moved, the node will be brought offline and will downgrade immediately, stripping the node of its master status. With SALT’s new system, users can move their Dash to SALT’s platform and maintain their masternode status as well as their voting and payout rights, all while using the associated funds as collateral for a loan.
The key to this software integration comes from a recent Dash update, DIP3, which introduces pro registration transactions. Instead of referring to another transaction from the network to sign a message as proof, a “proreg tx” refers to an output produced by the transaction itself, which in turn acts as proof of ownership. Users can now collateralize the Dash connected to their masternodes by parking their funds in SALT’s insured cold storage—the signature used to move those funds validates ownership, allowing users to continue participating in the network.
SALT, the pioneer of crypto-backed lending, offers crypto-backed loans and custody solutions for individuals and businesses. Committed to fostering adoption of blockchain technology, we’re working to bridge cryptocurrency with traditional finance. With an emphasis on security and customer service, we provide the technology, infrastructure, and tools that make it easy for crypto holders, businesses, banks, and governments across the globe to participate in the blockchain economy. Founded in 2016, SALT is headquartered in Denver, Colorado. For more information, visit www.saltlending.com.