Bitcoin

The Bitcoin digital currency began with a document published in October 2008. A little later, the software was created and on January 3, 2009, the Bitcoin transaction block calculated for the first time. Bitcoin Digital Currency uses a cryptographic protocol called the proof of work which implies that more processing power is utilized to calculate the signature of each subsequent block than the previous block. Therefore, the total computing power required to hack into a system grows continuously. Consequently, it has become more profitable for the owner of this computing power to join the network rather than resist it. The disadvantage of the proof of work algorithm is a huge power consumption required for calculations. The Bitcoin system consumes as much electricity as a medium-sized European country per annum.

Anyone can become a blockchain node provider in the Bitcoin network. All you need to do is to download and install software from the official Bitcoin website. Besides free public nodes, the Bitcoin network has BTC nodes which are not available to everyone. These are cryptocurrency nodes that are employed by exchanges, digital currency exchange services, wallet sites and other infrastructure projects. Additionally, the Bitcoin network contains cryptocurrency nodes that operate through hidden protocols such as Tor along with the implementations of crypto nodes in various programming languages. Nbitcoin implementation is written in C#), btcd is written in Go, bitcoind in C++, and bcoin in Node.js. Moreover, there are hardware cryptocurrencies nodes such as Casa, Lux Node, myNode, Lightning In A Box – the devices that only process transactions on the Bitcoin network.

A "light node" is a computer that has the Bitcoin client installed but it has not downloaded a complete transaction database called a blockchain. When a Bitcoin transaction is executed by a user, it moves between the light nodes until it reaches the full node. The full BTC node, synchronized with the blockchain, checks the transaction for validity. A non-valid transaction is rejected by the network, while a valid transaction is written to the blockchain via the BTC node and becomes an integral part of it. In total, the blockchain size already exceeds 100 gigabytes and the size increases with every performed transaction. The tracking BTC node (super node) compared to the full public node has more processing power and faster Internet connection.

The tracking BTC node (supernode) synchronizes the blockchain with several full cryptocurrency nodes at the same time. The more crypto nodes are in the public node network, the more decentralized and stable the digital currency network becomes. In contrast to miners, holders of public crypto nodes do not receive any financial rewards in the Bitcoin system. The Lightning Network system, designed to accelerate Bitcoin transactions, allows crypto nodes providers to earn commissions from users. However, the size of commissions earned in this network is so insignificant that nodes management in Lightning Network does not yield tangible amounts.

The full BTC node checks all transactions in the block for correct signatures. Afterwards, the public node checks how many blocks have been created by Bitcoin and whether the blocks and transactions are displayed in the correct format. The full BTC node should also check that there is no double-spending of the same funds in a blockchain. With a full BTC node system, "light" nodes can accept transactions, putting a complete check on full crypto nodes. Besides, a number of full BTC nodes confirm the transaction independently of each other. Owing to this system of free blockchain nodes Bitcoin digital currency remains decentralized and protected from hacker attacks.