What You Should Know About Nodes- Bitcoin & Dash
The crypto community likes to debate whether proof of work mining (POW) or proof of stake mining (POS) should reign supreme. But the thing about mining is that it isn’t the only technology that keeps the crypto machine working.
Although the miners sequence the transactions into a block, it is the nodes that determine if the transactions themselves are valid and follow the consensus rules.
Why would you want to run a node?
Running your own Full node means you no longer have to ask someone else if the transaction went through, if it was valid. You now have an authoritative record of your own that answers that question.
Here are a couple other reasons why running your own node is beneficial:
You have a choice in the event of a hard fork:
In the possible event of a hard fork where both blockchains remain active with economic activity on each side like the one in Ethereum/Ethereum Classic, running a full node is the only way you can validate the rules of the new or old blockchain, according to your preference.
Increased level of privacy:
Using a centralized, lightweight or even SPV wallet will never be as private as running a full node. Since you rely on third-party servers to broadcast your transactions for you, those servers will be aware of which addresses belong to you.
You may have noticed that I have not mentioned any type of monetary reward or incentive for running a full node.
Even though Bitcoin has not organized a plan to compensate users who run full nodes yet, Dash has.
Unlike Bitcoin which does not require a set amount of it’s coins to be used as collateral in order to qualify as a full node, Dash requires you to have 1000 of it’s coins to qualify for a master node, in return, Dash allocates 47.5% of it’s block reward to go to it’s masternodes. The 1000 dash coins remain in the persons possession, there is no need for you to transfer your private keys, and at any time you can remove yourself from the master node by reclaiming your collateral of the 1000 dash.
The dash master node does more than just verify transactions, they also coordinate the mixing of coins and participate in voting for budget funding.
Bottom line:
If you truly value this epic thing that is decentralized cryptocurrency and you’re looking for a way to be a part of the movement, consider getting involved by running your own node. Be sure to check out the additional links below for information regarding what you’ll need to set up a node.
Additional Information/Sources:
What is a node?
Why run a node?
Andreas Antonopoulos Explains Nodes
How to Run a Bitcoin Node
Actual cost of running a full node
Coindesk Article
Earn Money with a Dash Masternode
Learn more about Dash Masternodes
Do you think it is worth running a BOScoin node? Or prefer a Dash node?
Any update on this?
Great information again and, to top it all, it is so very clear and well written!
Thanks for sharing, I learned at least a little bit every time.
Namaste :)
Dash master-nodes will make the working of a currency to be more centralized, whereas the concept of Blockchain is distributed and de-centralize .. Do i miss something?
If you look at Bitcoin it is highly centralized by the major mining operations and you need major capital and cheap electricity to start one. I think this is an attempt to lower the barrier to entry.
You're right about the centralization of the miners, this is especially true in China, but it's very important to note that miners and nodes do very different things. Miners organize transactions into a block and get rewarded when they create a new hash. Nodes are responsible for verifying the validity of actual transactions. The more nodes that exist means a more decentralized blockchain, and faster transaction times.
From what I gather Satoshi's dream didn't foresee the split between miner and node. Mining was the incentive to run the node and now running a node actually takes quite a lot of resources and soooo much time to catch up to the blockchain and no real incentive other than maybe trying to anonymize transactions through TOR yourself without trusting a web wallet service. I like that Dash incentives nodes I wish I could afford one of those fancy Baikals to mine Dash with.
Great Info!! I just subscribed to your youtube Channel Also. Greetings from Mexico
There is always a way out
Thanks for the informative post!
I just known about bitcoin . Nice post thanks for sharing
Good stuff Heidi.
Let's not forget STEEM nodes 😀
There are seed nodes, witness nodes, and full web nodes capable of supporting content websites. Seed nodes are very beneficial to the network and it's also possible to earn rewards running a witness node.
The cheapest node atm seems to be pivx
Cheapest would be Chaincoin at this time.
That's right! Chain Coin is the cheapest and has the most potential. I wrote an article about this. https://steemit.com/cryptocurrencies/@globalrenegade/crypto-coins-with-explosive-growth-potential-10x-your-money