Bitcoin Full Nodes: What They Are and How to Set One Up

March 15, 2018

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What’s a Bitcoin full node?

The Bitcoin network is a collection of computers all over the world running the Bitcoin Core software that verifies transactions and blocks. It’s the distribution of these “nodes” (the term for a computer attached to the network) and the fact that anyone can set one up that makes Bitcoin “decentralized.” This means that anyone anywhere can set up a Bitcoin node as long as they have access to a computer with the required power and an internet connection. And if even one node is up and running, Bitcoin lives on.

Most Bitcoin nodes also act as a Bitcoin client, which allows transactions to be sent to the network. This means a node acts as your personal interface with the Bitcoin network as a whole. Running a node ensures that your Bitcoin transactions are verified and sent to whoever you’re transacting with. This puts the power to send uncensorable money across the world or across the street in your hands and contributes to the security and strength of the Bitcoin network itself.

Running a node is different than mining Bitcoin, which involves running special software that works to solve or complete new blocks on the network, releasing a certain number of Bitcoin to those computers responsible for adding a block to the blockchain. While mining Bitcoin has become quite resource-intensive and much of the mining work is being done by large companies with data centers devoted to the process, running a full node is accessible to anyone.

OK, I get it…. Why should I run a full node?

There are various reasons to set up a full node yourself:

You believe in Bitcoin and want the network to grow and succeed. Every node added to the network brings us closer to a future where everyone is transacting on the Bitcoin network and no governments or other third parties can do anything to stop it.
You intend to use the Bitcoin network to transact a lot and want to ensure that your transactions are verified. The idea behind Bitcoin is the removal of trust from the monetary system: you don’t have to trust a bank to hold or send your money. But as long as you’re not running your own node, you’re still trusting someone who IS running a node to verify that transaction in a timely manner. Taking your financial life into your own hands is empowering.
You can tell all your friends that you don’t just own Bitcoin, you ARE Bitcoin… at least part of it 🙂

Not sold yet? Here are some great reasons other people think you should run a node too.

I’m convinced! How can I set up a full node?

There are 3 methods to go about setting up your own Bitcoin node as of right now, ranging from pretty technical and time-intensive to really easy but a little more expensive. As development and adoption of Bitcoin technology continue, this process will only get easier and cheaper. If you want to get ahead of the game and jump into the action now, though, you’ll do it in one of these ways:

Setting up a node on your own computer (or Raspberry Pi or any machine with the required hardware),
Setting up a node in the cloud using a hosting service like Amazon Web Services, Digital Ocean or any number of other providers, or
Buying a standalone “node-in-a-box” device that sets up the node automatically

Setting Up on a Computer or Cloud Server (Options 1 or 2)

For the first two methods, the process is about the same. There are two ways to go about setting up a node on a computer (whether that computer is in the room with you or in a data center somewhere).

There’s official guidance from bitcoin.org on how to set up a full node on your machine manually. This requires a moderate technical background or the willingness to learn and pay close attention. There are risks and costs involved and you’ll have to be on top of your game to be successful here. See the full node official page for this information as well as this great guide published by 99Bitcoins.
You can make use of a Docker-based node that will simplify setup. Docker is software that allows you to create a virtual computer or “container”, set it up exactly as you like, and then save the setup and start it up whenever or wherever. There are various projects out there that have set up Bitcoin nodes in Docker containers for easy deployment. This is probably the way to go here provided that the project is trustworthy and being maintained by its author. Always check out a project’s activity or consider contributing yourself if you are going to make use of it. There’s a Docker guide here and various guides out there on how to set up Docker in the cloud. A nice cheap server provider can be found here ($8/month for a machine powerful enough to run a node).

Node-in-a-Box (Option 3)

This is by far the easiest way to set up a full node right now. A simple plug-and-play box that you’d plug into your internet router just like a cable box. This lets you run a dedicated node without installing anything on your computer or another machine.

The only project seemingly available right now is Bitseed. The Bitseed is currently pretty pricey at around $360, but from reviews, it seems to work as advertised and keeps things very simple. There are bound to be competitors coming out of the woodwork in no time, so keep an eye out as the space matures.