A masternode is essentially a crypto computer wallet that keeps the full copy of the blockchain in real-time. Besides keeping the full blockchain and acting as the "glue" by relaying blocks/transactions (providing connections in the chain), masternodes also have the potential to increase the privacy of transactions & allow the participation in governance & voting.
Those running such nodes, are typically compensated by a portion of what is known as "block rewards". These rewards usually increase/decrease in accordance with a published reward schedule. The Flits app makes running masternodes, and in turn receiving such rewards – both simple & fun!