All About Bitcoin Node and Its Functions

Blockchains are vital for cryptocurrencies to become operational. Bitcoin is a cryptocurrency. In the absence of a blockchain, Bitcoin would have no unique selling propositions (USPs). These USPs, include security, decentralization, efficiency, etc. For more information, you need to visit phandroid.com.

The Blockchain Network

A blockchain refers to a network or a digital ledger. This ledger records every transaction involving Bitcoin, within it. The processes of verification and recording are rather complex/sophisticated. 

The blockchain itself resembles blocks. They appear as a list of records. These blocks are goldmines! They contain every single bit of information regarding deals involving Bitcoin. Every transaction takes place between a sender and receiver only.

The Network’s Operating Method

A cryptographic technique comes into play for adding new blocks to the Bitcoin blockchain. This technique is ‘hashing’. This method ensures that the blockchain becomes immutable. Once a transaction is recorded/added, there can be no question of modifying or deleting it. The record remains exactly as it is, forever. 

Before recording/adding a transaction, however, a miner, or a group of miners, must verify it.

Who are miners?

They are responsible for providing the computing resources that will assist in verifying the authenticity of a transaction. Every successful verification is eligible for a transaction fee. 

The miner/miners also receive a reward, for successful mining/discovery of a new block.

How do miners operate?

■ There is heavy competition amongst individual miners, or a group of miners, to discover the hash of the next block. 

■ This hash consists of a lengthy line of alphanumeric characters.

■ Each miner offers some resources for the discovery process.

■ Whoever guesses the new hash correctly, takes over the role of the miner for the new block. This individual/group is in line for the reward too.

■ A new block joins the queue every 10 minutes. 

■ Mempool is the name of the block queue.

■ As soon as the newest entry joins the queue in the blockchain, everyone in the Bitcoin network comes to know about it. 

■ Thus, it becomes a permanent member of the blockchain.

Bitcoin Nodes

Verification refers to identifying the authenticity of the monetary transaction that takes place on the blockchain. Nodes come into play for this process.

Node is the technical term. It refers to the computer systems coming into play for verifying transactions. If only one computer is active, one must understand that the alone node is functioning on the Bitcoin blockchain. Several computers in action, indicate several nodes. The number of computers and nodes exactly match one another. 

Bitcoin nodes are vital for maintaining the integrity of the Bitcoin blockchain. They cannot afford to let cybercriminals get through, and meddle with transactions.

Kinds of Nodes

Two types of nodes are in evidence. One is Full Node, and the other is Light Node. The differences between them, include –

■ The Full Node program is responsible for the complete validation of blocks and transactions. These blocks and transactions may be from other Full Nodes too. Thus, the network receives healthy support.

Light Nodes may function, only if they are dependent upon Full Nodes.

■ A Full Node demands a high quantity of disk space. The requirement is for downloading and storing past information, that is, old ledger data.

A light node does not engage in downloading the complete blockchain. Therefore, it requires less space for storage.

■ By validating and relaying every transaction to other Full Nodes, the Full Node program renders the Bitcoin blockchain immutable. 

A Light Node uses the SPV (simplified payment verification) processes, to verify transactions within the blockchain.

Functions of Bitcoin Nodes

■ Decentralization – The Bitcoin blockchain stretches across numerous computers across the globe. Thanks to the Nodes, the same information is recorded on every computer’s ledger. Every ledger is an open-source one. Therefore, anyone may check Bitcoin’s transaction history, without interference from a third party.

■ Transparency – The Nodes help in the fair circulation of Bitcoins on the network. They undertake audition of the supply of Bitcoins and addresses, too. This way, they ensure that only the possessors of both may spend the Bitcoins.

■ Immutability – Any Node that finds a new block on Bitcoin’s blockchains, shares the information with the other Nodes. Hence, every transaction becomes immutable. There may be no manipulation or removal of vital information. In turn, Bitcoin’s blockchain remains safe from fraudsters and scammers.

Similar Stories