Nodes play a critical role in blockchain security. Typically, a cryptocurrency node is a participant processor in a blockchain network. To say that no blockchain can exist without blockchain nodes would not be an overstatement.
The main feature unique to blockchain technology and why cryptocurrency has proved to be so revolutionary is decentralisation. Unlike centralised systems, Ethereum and most other crypto-assets aren’t controlled by a central server or group. Instead, the blockchain networks function as peer-to-peer (P2P) systems. People in a proper P2P system interact directly rather than through an intermediary because of the decentralised network nodes.
All decentralised networks need a way for the network to maintain its integrity to function. Each participant needs to be assured that all blockchain transactions are valid and that none of the participants on the network is cheating via double-spending or reversing transactions.
The process by which everyone on the network agrees that the entirety of transactions is valid without a central authority is called “achieving consensus”. The network nodes do the work that creates this consensus among users to make the blockchain secure.
There are various types of nodes in a blockchain network. Let’s discuss a few of them:
Light or lightweight nodes, utilised primarily on day-to-day crypto operations, are called Simplified Payment Verification (SPV) nodes. You have probably interacted with one. When you use a “light wallet” on your mobile phone or another device, you are utilising a light node!
This type of node interacts with the blockchain while depending on full nodes to feed them with the necessary information because they don’t have a copy of the chain. They get by querying the current status for which block was created last and then broadcast transactions for processing.
Because light nodes do not validate or build blocks, it is evident that running an SPV node doesn’t require many resources. It also impacts security negatively for convenience.
When a transaction is sent to be validated, the transaction validation comes from the nearest node that maintains all that information. The nodes maintain all transaction records in a blockchain network and are thought to be the servers of the blockchain.
Also, the full nodes participate in the governance of its blockchain. Each full node has voting power in the blockchain. There are several governance models, and usually, a blockchain network attempts any upgrades or improvements (also called forks) only after a majority of full nodes agree to it. A hard fork happens when at least 51% of full nodes agree to make a change to the blockchain. The existing chain will continue running, but a new blockchain with the change enacted will be created. A popular example is Ethereum and Ethereum Classic, which arose due to the DAO hack in 2016. In notable recent events, Do Kwon has proposed a hard fork of Terra due to the collapse of its stablecoin, UST.
It is crucial to understand that there may be instances where many full nodes agree to modifications in the blockchain network, but they still do not form a majority of at least 51%. For example, 55% of nodes concur to a specific change, while 45% do not. In this case, there is a possibility that a hard fork (or a permanent separation) will occur, which means that the Blockchain is split into two. The original Blockchain will continue to work as it did, and the forked Blockchain will work with the changes made by those 55% full node holders.
Full nodes are further divided into:
Pruned Full Nodes
These are nodes that have a defined memory limit for data storage. While there isn’t a limit to how many blocks can be added to the blockchain, there is a limit to how many blocks can be stored in this full node.
To maintain the blockchain ledger, pruned full nodes regularly download the blocks from full nodes. When it reaches a particular storage limit, it gets rid of the oldest blocks to make more space in the storage for the new blocks to preserve blockchain size. However, it is vital to note that the old blocks are not entirely deleted since their essential metadata and sequence in the blockchain are retained to maintain the basic principles of blockchain.
Archival Full Nodes
Archival full nodes are the most commonly found full nodes in a blockchain. They keep the full blockchain in their database. The only fundamental difference between a full archival node and a pruned full node is the size of the available memory space.
Archival nodes are further classified into the following categories:
A public blockchain is open for anyone to join to become a node. This can be done by synchronising their system (node) with the blockchain data. However, in most circumstances, each node is also required to maintain access to data for all the other nodes. In this case, the blockchain needs to be run by certain authorised entities.
This is what authority nodes are used for. The name for these nodes is derived from the fact that they are in control of or responsible for authorising other nodes to be added to or removed from the blockchain network.
On some blockchain platforms, authority nodes are even authorised to define other nodes’ access to a particular channel and the data within. For example, the doorman service featured in Corda or the Membership Service Provider feature in Hyperledger Fabric seeks to maintain the digital identity of every node. This is an example of how an authority node operates.
Miner Nodes/Validating Nodes
For many blockchain networks where Proof-of-Work (PoW) is the consensus algorithm, some nodes are charged with solving complex mathematical functions to validate each transaction on the network. Such validation tasks often require significant computational power and energy consumption. The nodes created especially to carry out the mining process are called miner nodes.
Master nodes are simply full nodes that are not authorised to add new blocks to the blockchain. Their job is merely to maintain the blockchain ledger and validate the transactions.
Like miner nodes validate transactions in a Blockchain with a PoW consensus mechanism, there are staking nodes for validating a transaction on the Proof-of-Stake (PoS) consensus algorithm blockchains. In PoS, these nodes are asked to stake their money, validate the transaction, and then get rewarded for it by collecting transaction fees.
In staking, the nodes are selected per predefined rules such as coinage or time spent on the network. The chosen node is then charged with validating transactions and earning an incentive. These nodes do not need to have great computation power. PoS eliminates the need for mining nodes since only master nodes are needed for validations, and staking nodes can validate transactions, assemble them to build new blocks and add them to the chain.
RockX runs many such nodes as we are a staking service provider, which means that users can stake by delegating their crypto to one of our validators instead of running an entire node themselves.
This was a very generic overview of the various types of nodes needed to operate a blockchain. With new advancements in blockchain technology every day, new types of nodes will continue to be built as new consensus mechanisms are devised to combat the infamous blockchain trilemma. All of these nodes work together to ensure that data on the blockchain is safe and accurate.