Ask CryptoVantage: Do I Need to Run a Bitcoin Full Node?

What is a Full Node?

A bitcoin node is a computer that takes part in the bitcoin network by running bitcoin software. Bitcoin nodes connect with other nodes in the network and communicate with each other to track ownership of each bitcoin and to ensure all transactions are valid. “Full node” refers to nodes that fully validate bitcoin’s history, as opposed to non-full nodes which rely on other full nodes to do the validation.

You absolutely do not need to run a full node to use Bitcoin but there are some interesting advantages to doing it.

Why You Should Run a Full Node

Bitcoin was created to be a peer-to-peer electronic cash system that can be used without needing to trust other parties such as banks and companies. Running a bitcoin full node is the only way to use bitcoin in a “trust-minimized” peer-to-peer manner. For example, if you don’t run a full node and someone claims they sent you a bitcoin payment, how can you be sure they sent the payment? Without a full node, you are left trusting the other person, or relying on someone else’s full node to tell you that the payment went through.

Downsides to Running a Full Node

Running a full node does come with its downsides. It is best practice to have a dedicated computer that is used only as a bitcoin full node, which minimizes the chances of any viruses getting into your full node. Having a dedicated computer can become costly when you consider the hardware, storage space, and bandwidth required.

Many bitcoin users choose to run their bitcoin nodes on Raspberry Pi computers, since they are small and affordable. If you want to store the entire bitcoin blockchain, you’ll need 500+ GB of storage space – but you can choose to discard blocks after validating them by running your node in “pruned” mode. A pruned node only requires 10-20 GB of storage space. Running a bitcoin full node also uses a lot of internet bandwidth, although that too can be reduced by changing your node’s settings.

Alternatives to Running a Full Node

Some people choose not to run a full node because they prefer a simpler process that doesn’t require setting up and maintaining a computer. While this option involves trust, it can be appealing to many users.

Bitcoin wallets usually connect to someone else’s full node automatically – often the wallet company’s node – to determine your balance and validate transactions on your behalf. This is the simplest alternative to running a full node but does require a lot of trust in the wallet company.

Another popular alternative to full nodes is known as a “block explorer”. Block explorers are websites that allow you to examine bitcoin’s history of blocks and transactions. Again, you are left trusting the provider of the block explorer to give you truthful information, but one advantage to block explorers is that you can cross-reference your transactions on a few of them rather than trusting just one.

How to Get Started

To get familiar with using a bitcoin full node, consider installing Bitcoin Core on your main computer. Bitcoin Core is the bitcoin software that most people use for their full nodes. Since it will be installed on a computer with other programs running, you shouldn’t store a lot of bitcoin on it. Instead, send a small amount to your Bitcoin Core node so that you can get a feel for how to use your full node. Once you are comfortable with it, you can choose whether you want to set up a full node on a dedicated computer such as a Raspberry Pi.