In this article, I list the costs of setting up and running a node in Nigeria, informed by my experience of running one in the last two years. I also offer some cost mitigation suggestions to encourage more participation in the bitcoin network.
Before exploring the costs involved: What is a bitcoin node??
A bitcoin node is software that connects to the Bitcoin peer-peer network. A node receives, validates and transmits transactions/blocks to other nodes in the network, according to the rules of the network. ted stevenot nodes concisely described as the messengers and guardians of the Bitcoin rules.
Streaming blocks are part of a distributed ledger that contains records of each transaction, keeps track of bitcoin ownership and the corresponding amount of ownership. This publicly shared ledger is generally known as Bitcoin. block chain.
A Bitcoin node typically runs on single board laptops (SBCs) like the raspberry pior in a personal computer. However, a node can also run in a virtual machine or on a smartphone. Bitcoin Core is the most widely used bitcoin node software and can be downloaded here.
Nodes can be full or light:
- A full node stores a complete copy of the blockchain and checks every transaction and block, from the first block, the genesis block, against the consensus rules. consensus rules they are sets of specific rules applied by full nodes to determine the validity of a block and its transactions.
There are two types of full nodes: file nodes Y pruned nodes. Archive nodes store the entire blockchain locally and broadcast it to other nodes, which also helps to bootstrap new ones. Meanwhile, a pruned node only saves a specified minimum number of blocks while verifying transactions and blocks. Therefore, deleted nodes save more computer disk compared to archive nodes. However, pruned nodes cannot serve the entire blockchain to other nodes.
- A lightweight node does not enforce consensus rules and relies on full nodes run by third parties to receive block data, which is a privacy tradeoff.
Full nodes will be the main focus of this article: any mention of “node” henceforth implies a full node unless explicitly stated.
Why run a node?
There are personal and network benefits to running a node. Some of these include:
- Privacy when transmitting transactions, verifying bitcoins received in your wallet, and exploring blockchain data, without third parties recording your personal information.
- Strengthening of the Bitcoin network. The more nodes there are in the network, the more decentralized and resilient Bitcoin becomes against malicious parties, jurisdictional restrictions, or black swan events.
- Increase your understanding of how the bitcoin network works and share this knowledge with others.
With some of the benefits outlined, let’s look at the costs of running a node from a Nigerian perspective.
Common hardware, which meets the minimum requirementsused to run a bitcoin node are:
- Plug and Play nodes or
- DIY nodes.
Plug and play node
Some bitcoin companies offer plug and play full node products that run on SBCs like the Raspberry Pi, rockpro64 Y rock pi4and mini PC like the Intel NUC Y Librem Mini. Some of these node providers are:
Node prices range from $300 to $700, excluding shipping ($100 minimum to Nigeria) and customs duties, depending on hardware and storage size. International purchases made with most Nigerian Naira debit cards are currently limited to $20 per month, a reduction from the previous limit of $100. Your node purchase options are to use a dollar debit card —tied to a home account— with deposited dollars obtained from the black market (currently 70% above the official rate), use a virtual dollar card that offers convenience but at a higher rate than the black market and bitcoin.
There are other obstacles that you may encounter when purchasing a node. First of all, not all node providers ship to Nigeria. Also, due to the shortage of chips, some of these products are out of stock. One way to overcome some of these obstacles is to use the alternative offered by node providers of obtaining node components yourself and installing their respective embedded bitcoin core software on your assembled node.
When getting hardware components, we will only consider SBCs as they are cheaper than mini PCs. The hardware components required to run an SBC node are:
- SBC + power supply
- SD card + reader
- SSD + enclosure
- Heat Sink Case/Fan
The current shortage of chips and high demand for single-board computers have led to massive increases in prices and supply shortfalls, Raspberry Pis in particular both locally (used and new) and internationally. However, some Raspberry Pi and RockPro64 are available in aliexpress. Regardless, there are some fake sellers on the platform, you should be especially careful with newly created stores, read negative reviews, and request a refund if an item does not arrive within the estimated period.
Given the international purchase limit on Naira debit cards, these SBCs will need to be purchased with a dollar card; there is no option to buy bitcoin. The following table summarizes Aliexpress’s average hardware component costs, to build new Raspberry Pi or RockPro64 nodes.
Before a node can perform its role as messenger and rule keeper in the bitcoin network, it must synchronize with other nodes in the network. This is done by downloading and verifying all the blocks in the genesis block in a process known as Initial Block Download (IBD). Currently, the bitcoin blockchain is approximately 440GB in size.
The table below summarizes the average data costs, from network providers, for IBD and approximately 5.3GB required monthly to sync your node with the blockchain. It is assumed that you reside in an area with somewhat reliable 4G network coverage.
To simplify the energy cost analysis, it is assumed that you live in a region without electricity (at least 80% of the time in my location) and you will need a solar generator to power the node and router, which is not the case. ideal. since it depends on the weather. Replicating something similar to Chimezie Chuta space box incurs subsequent average costs.
Finally, the estimated full node setup costs are tabulated below.
Running your own Bitcoin node has many benefits, some of which have been listed above. However, with continued chip shortages, inflation, and node setup costs (despite the assumptions and cost reduction recommendations made in this document), running a node might not be feasible for everyone. A practical solution would be to implement Arman The Parman’s circle of trust idea or of Obi Nwosu guardians and users model of having a technical individual run a node for a group of trusted people such as close friends, family, or a community. This approach does come with a trade-off, but it’s much better than connecting to third-party nodes and helps ease the bitcoin custody challenge.
This is a guest post by chinedu. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.