Masternode is simply a cryptocurrency full node or computer wallet that keeps the full copy of the blockchain in real-time, just like you have Bitcoin full nodes which is always up and running. Masternodes are slightly different in their functionality compared to normal nodes and are entitled to varying forms of incentives for providing their services. (I have explained that in the above-linked article)
For setting-up a masternode, you have to commit and buy-in a considerable amount of particular crypto coins and hold them in a wallet that is always up and running. And in return for providing your resources to host a masternode, you get native cryptocurrencies in reward.
But always remember that buying the coins and setting up a masternode early is the key.
Of course, there is a waiting time risk associated with setting up of a masternode early, but if you are confident about the coins, there is no harm taking a calculated risk.
Also, you need an eagle’s eye to spot the right project because there are many projects in the cryptosphere announcing their masternodes just to lure-in new investors but in reality, there is no need of a masternode for their project.
That’s why you need to be careful. From a long list of cryptos available in the market today, I feel the following coins have impressive masternode policies and look like they are here to stay.