A decentralized and distributed network like Bitcoin derives part of its strength from the number of participants in it. When we say participants, we are not talking about Bitcoin holders necessarily. We are rather referring to those who run Bitcoin nodes, especially those who run full nodes.
People who run full Bitcoin nodes derive some hidden or intangible benefits from them. We will explore the advantages and costs associated with running full Bitcoin nodes, offering a variety of solutions for those of you who are considering the option of running a full Bitcoin node.
What is a Bitcoin Node?
A Bitcoin node is basically a computer that runs the kind of software that allows it to communicate with other computers on the Bitcoin network.
- Full nodes hold a complete copy of the blockchain – every Bitcoin transaction ever made – and can broadcast transactions to the network by communicating with other nodes.
- Each full node can verify the transactions that other nodes are broadcasting and then pass the message on until there is an emerging consensus about the transaction. At that point, miners can timestamp it and a change to the distributed ledger can be made.
- Full nodes can also spot malicious actors who try to double spend coins or broadcast transactions that should be invalidated. If there is some kind of malicious behavior within the Bitcoin blockchain, full nodes can isolate, “quarantine” or cut the source of that malicious behaviour out of the blockchain.
What is the Difference Between a Full Node and a Light Node?
Before we go into the advantages of running a full Bitcoin node, it is important to make a distinction. There are two types of Bitcoin nodes: Full nodes and light nodes.
- Only full nodes can enforce consensus rules on the Bitcoin network.
- Light nodes follow the majority of the mining power.
Given that Bitcoin is about verifying instead of trusting, running a full node is the only way to gain certain critical rights within the network that allow users to keep any single entity from subsuming it to their own interests.
What are the Advantages of Running a Full Node?
This is the first pro that users will derive from running a full Bitcoin node: Political power. Full nodes in the network have a say. Thanks to the consensus mechanism and how the network is set up to allow nodes to communicate with each other, verifying transactions, full nodes can signal their support or lack thereof to any change within the network.
Miners ultimately follow consensus due to game theory. Mining is expensive, and miners want to make sure that a consensus of full nodes will accept the blocks they mine. Otherwise, miners would be unable to reap a profit, or at best would have greater uncertainty about the profitability of their mining operations. The clear example of this was when the User Activated Soft Fork – UASF – took place on August 1st, 2017. A considerable amount of mining power in the network opposed the change that brought about the implementation of SegWit. Full nodes, however, were able to come to a consensus and enforce the new rules.
Full Node: Advantages Beyond Political Power
Apart from political power, there are other advantages in running a full Bitcoin node. Here is a list of those advantages:
- It gives you the power to choose. This is a corollary to the political power point: When you run a full node you also chose the kind of software you run and if you want to split from the chain after a hard fork, you are completely entitled to do so.
- You don’t need to trust the node that your wallet service is running anymore because you can verify and broadcast transactions from your own node. This is an essential tenet of Bitcoin.
- Added privacy. Running a full node allows you to broadcast transactions without giving away critical meta data that could grant a centralized service enough information to tie your addresses to your identity.
- It is relatively inexpensive to run a full Bitcoin node. The basic cost is computing power and internet data – which is why it is important to emphasize that the cost of running a node is relative.
What are the Disadvantages of Running a Full Bitcoin Node?
Whether you should or should not run a full Bitcoin node comes down to the real costs you will incur. There are also security risks involved in running a full Bitcoin node. One of the possible attack vectors on Bitcoin, involves knocking down as many Bitcoin nodes as possible. Nevertheless, there are no reports of this ever happening at a large enough scale. Therefore, it is more useful to focus on the economic costs. The math here is also pretty simple, so anyone can do it:
- The size of Bitcoin blocks is 1 MB.
- A new block is released every 10 minutes – the blockchain is quite consistent in this regard, although that 10-minute target is not always achieved.
- This means you will be downloading 6 MB worth of data an hour on average if your node is on the whole day.
- That is 144 MB of data per day and around 4.3 GB of data in a 30-day period.
- There are more than 580,000 blocks in the blockchain.
- If you download the whole blockchain, you are going to need around 600 GB of data on your connection to do it.
- As the blockchain gets longer, the initial amount of data needed to download the whole blockchain will increase.
Given this information, running a full Bitcoin node will require you to have a big data limit – if not unlimited data – on your internet connection, at least for the first time you sync the blockchain. After that, you will have to make sure that your band width allows you to download the amount of data needed to keep your node up to date and run your usual internet activities in tandem. This presents a barrier of entry for people in certain countries and in certain socio-economic situations.
Getting Around the Entry Barrier
In any case, if you can’t do this at home because your internet connection is limited to a certain amount of data per month and your band width is not broad enough, you might be able to get around that entry barrier through the following options:
- Set up your node and find a big enough public network to download the blockchain on. Maybe the public library around the corner has a powerful enough connection, or if you are a college student, maybe you have enough resources to get your node running at school.
- Get a node with preloaded Blockchain data. There are quite a few options in the market to acquire a preloaded node and start operating.
- Copy the blockchain from another node offline and then load it onto your own node. This can be technically challenging.
How can I Run my Own Full Bitcoin Node?
On the cost front, there are a few options you can explore to set up your own Bitcoin node. Some services allow you to buy a node with preloaded blockchain information, which is a great solution for people who don’t have access to unlimited internet data. On the other hand, there are a bunch of DIY node solutions out there to set one up on the cheap, but most require unlimited data. Here are some of the options you can explore:
- Run a full Bitcoin node on your computer at home, following the guidelines provided by bitcoin.org.
- Set up a node using a Raspberry Pi – there are numerous clips and DIY guides to help you install the client and run your node on this type of hardware. To find out more about this option, read our Raspberry Pi node blog post.
- Get a preloaded node from services like Nodl, Casa Hodl and full-node. Full-node uses a preloaded Raspberry Pi. For more information on Nodl and Casa Hodl – the leading alternatives for preloaded nodes – read our blog post comparing both services.
So, Will You Run Your Own Full Bitcoin Node Now?
Now that you know what a full Bitcoin node is, what are the advantages and disadvantages involved in running one, and which options are there for you to start running one, you can go ahead and set a full node up. It is clear that the advantages far outweigh the disadvantages, and a healthier Bitcoin network needs more full nodes. Therefore, even if you don’t have a direct financial incentive to run a full Bitcoin node, adding another node to the network will allow you to contribute to the overall well-being of Bitcoin, a desirable outcome in terms of the value of your own coins.