Setting up a Blockchain Node

Blockchain nodes are popping up everywhere as new blockchains emerge and staking opportunities become a real source of income. But can you set up a node yourself? And if so, how?

This article covers everything you need to know, hardware and software requirements, network config and management tools to set up a node, which is the first step to being part of a decentralized network whether for cryptocurrency transactions, smart contract development or maintaining a blockchain ecosystem.

Blockchain nodes are part of a blockchain network that verify transactions, maintain consensus and record the blockchain’s history. They ensure each active participant in the network has an identical and up to date copy of the network’s data. At the most basic level it’s a computer system or hardware device that runs the network’s software to do the work and keep it secure. Nodes have different roles and responsibilities. An “online node” is a node that sends updates across the network and is always active. An “offline node” only needs to download the latest ledger when it reconnects to the network to stay in sync. This is called blockchain sync. To keep your node running smoothly you need to meet the hardware, software and network requirements for the blockchain protocol.

In the context of cloud based node hosting dedicated nodes offer high scalability and flexibility so you can manage resources as needed.

What is a Node?

A blockchain node is a computer that connects to a blockchain network and is part of the network’s security and integrity. By validating transactions and blocks nodes ensure the blockchain is trustworthy and decentralized. There are different types of nodes each with a different purpose.

A full node has a copy of the entire blockchain, it’s a critical component for validating transactions and the network’s history. A light node only has a portion of the blockchain and relies on full nodes for data verification. Specialized nodes like mining nodes solve complex math problems to validate transactions and create new blocks. These nodes are part of the blockchain network so all participants have access to the same and up to date information.

How it works

Nodes connect to the blockchain network and download the blockchain. This initial sync can take some time depending on the size of the blockchain and your internet connection. Once synced nodes start validating transactions and blocks.

Each node checks that transactions and blocks follow the network’s rules and protocols. For example a node will check that a transaction has the correct digital signatures and the sender has enough funds. Once a node has validated a transaction or block it adds it to its copy of the blockchain and sends it to other nodes in the network. This continuous process of validation and broadcasting ensures all nodes agree on the state of the blockchain and the network is secure and trustworthy.

Node Types

Here are the different types of nodes in blockchain and their purpose;

1. Full nodes are servers or computers that download and store the blockchain’s transaction history, they also validate transactions and record transactions. A bitcoin full node validates transactions and maintains the Bitcoin network by ensuring all rules are followed and blocks are added correctly.
2. Light nodes are a simplified version of full nodes, they store a portion of the blockchain’s headers and rely on full nodes to work.
3. Validator nodes are full nodes that participate in the blockchain by validating blocks and approving transactions. They are responsible for archiving all network activity such as crypto transactions or smart contract executions without fail.
4. Lightning nodes are nodes that execute transactions off-chain through layer 2 scaling solutions so they can handle network congestion. Some examples of layer 2 scaling solutions are Arbitrum, BNB Chain, Ethereum, Optimism and so on. When a transaction is processed the transactional data is added to the mainnet.
5. Mining nodes as the name suggests are nodes that solve complex math problems, add new blocks to the blockchain and earn mining rewards. This depends on the blockchain, for example in some blockchains mining rewards are given based on the amount of coins they hold while some are given rewards for the number of transactions they validated. Mining is associated with blockchains like bitcoin and requires high end computing devices to work. Pruned full nodes are full nodes but with a better approach to storing historical data. These nodes delete the downloaded blockchain data in chronological order to operate and manage storage efficiently.
6. Authority nodes are full nodes where the nodes authorize the generation of new blocks, this community decides the number of nodes required to approve a blockchain transaction, this is done by the community through voting. Masternodes are also a type of full node that can’t add new blocks to the blockchain but are responsible for ledger maintenance and transaction verification, they contribute to the security of the blockchain.
7. Lightning nodes are nodes that execute transactions off-chain through layer 2 scaling solutions so they can handle network congestion. Some examples of layer 2 scaling solutions are Arbitrum, BNB Chain, Ethereum, Optimism and so on. When a transaction is processed the transactional data is added to the mainnet.

The first step in setting up a blockchain node is to decide which type of node you want to set up. Blockchain nodes have different purposes and functions as seen above so the node that suits your specification or requirement should be chosen. Full nodes enable maximum participation in blockchain activities and require lots of storage and bandwidth while light nodes are less demanding but give limited functionality. Next is to decide which blockchain you want to support with your node, each blockchain has its own requirements and software for this. Popular choices are Bitcoin, Ethereum, Polygon, Solana and others with Bitcoin and Ethereum having the largest market capitalization. As of February 2024 there are approximately 18,000 public nodes running on the Bitcoin network. On the other hand Luke Dashjr, a Bitcoin Core developer and one of the earliest contributor to the Bitcoin ecosystem, estimates that there are over 100,000 Bitcoin nodes, as of January 2025.

Once the node type has been chosen, a device with good hardware specifications like storage, ram, processor and a good Operating System (OS) will be used to download the official software for your chosen blockchain.

The software will then be installed using the official documentation or guides for the specific blockchain you have chosen. These will provide step by step instructions on installation and configuration. After the software is installed and configured the node will be synced with the network. This may take several hours or even days depending on the blockchain’s size and your internet connection speed. Once the node is installed it will need to be managed by regularly checking for updates of the blockchain software and installing them.

Running Your Own Node

Running your own node has several benefits, it enhances your security and control within the blockchain network. By running a node you can verify transactions and blocks independently, you don’t have to rely on third-party services. This autonomy protects your privacy and ensures your transactions are processed according to the network rules.

Also running a node supports the decentralized nature of blockchain networks. By contributing to the network’s infrastructure you help maintain its integrity and resilience. This is crucial for the health of the blockchain ecosystem as it ensures a diverse and distributed network of nodes. Whether you are an individual who wants more control over your transactions or a business that wants to provide reliable services to your customers, running a node is a good endeavor.

Who Should Run a Node?

Anyone seeking to earn staking rewards while supporting a blockchain network's decentralized infrastructure should consider running a node. Staking nodes allow participants to lock up their cryptocurrency, contributing to the network’s consensus and security while earning rewards in return.
 

Do you want to participate in a blockchain network and support its decentralized nature? Run a node and have more security and control over your transactions and businesses contributing to the network’s robustness.

Developers in particular can benefit from running a node as it gives them direct access to the blockchain network and the ability to verify transactions. This is necessary for buildingbuilding and testing decentralized applications. Businesses that rely on blockchain technology can also improve their service reliability and security by running their own nodes. By running a node you not only get more control and security but also play a big role in maintaining the decentralized and secure nature of blockchain networks.

Minimum System Specifications

Some blockchain nodes solve complex mathematical problems while some require high bandwidth to interact with the blockchain and this can only be done by high-end devices. The following are the minimum system specifications for blockchain nodes;

• Processor (CPU): A modern CPU with multiple cores will do the work efficiently.
• Memory (RAM): At least 8 GB, 16 GB or more for high-performance nodes.
• Storage: The amount of storage needed will depend on the type of node to be installed and also the size of the blockchain. For example full nodes which download and store a blockchain’s transactions will need SSD up to 100GB. Some blockchains like Bitcoin require hundreds of gigabytes while others might need less.
• Graphics Card (Optional): This will only be needed for nodes involved in GPU-based mining or advanced computations.

Running an Ethereum node requires specific storage and memory based on its operational modes: fast, full, and light. Fast nodes need around 200GB of storage, full nodes need over 1TB, and light nodes need much less. Memory requirements also vary, fast and full nodes need at least 8GB of RAM.

Network Connectivity Requirements

This is one of the most important requirements for a blockchain node to function properly, A stable internet connection with at least 1 megabyte per second upload and download speed would do. Higher speeds will improve synchronization and boost transaction validation and thus increase transaction speed. Unlimited data subscriptions are a must as nodes handle large data volumes. A static IP address is preferred for stable connections and easier port forwarding.

A testnet can be used for testing and development purposes as an alternative to the mainnet. It may have user-friendly interfaces like GUI in Shardeum to make it easier for non technical individuals to run a node.

Special Hardware Requirements

These special Hardware are in addition to high-end devices. Some examples are:

• Power Backup: Install an Inverter where there is no constant power supply to have consistent uptime with an Uninterruptible Power Supply (UPS).
• Cooling: Blockchain nodes are always running and because of this they generate heat continuously which can reduce their efficiency. Efficient cooling systems should be installed to extend hardware life.
• Redundancy: Backup for data and hardware components reduce downtime risk in case of system damage.

Software Requirements for Blockchain Nodes

Software requirements for blockchain nodes will vary depending on the blockchain, you will need to download the official software of the blockchain node you want to run. Most setups include blockchain client, operating system configurations and relevant libraries or Software Development Kits (SDKs). Software Development Kit is a collection of tools that help developers build blockchain platforms, applications and other advanced features. SDKs are essential for developers because they have all the necessary tools in one package.

To install node software you need to follow specific instructions to connect it to different networks, mainnet or testnet.

Choosing the Right Blockchain Client

Blockchain client is the software that blockchain nodes run to connect to a blockchain network. From these clients developers can create various applications like block explorers and cryptocurrency wallets. Most blockchains have their own native clients, so the blockchain client to be used will be determined by the blockchain you want to support. Some examples of blockchain clients are:

• Bitcoin Core: This is for Bitcoin nodes, full and light nodes.
• Polygon CDK: This blockchain client allows users to build their own chain, faster transactions.
• Geth (Go Ethereum): For Ethereum, to participate in smart contracts and transaction validation.
• Fire dancer(Solana): High-performance client written in C++ to increase Solana's transaction processing.

Operating System Requirements for Blockchain Nodes

This is also important as a system requirement. There are different types of operating systems and most blockchains support major operating systems like Linux, macOS and Windows. Linux is preferred for most nodes because of its stability and compatibility. Popular Operating Systems are Ubuntu and CentOS which support computers and virtual private servers. Windows or MacOS are suitable for smaller networks or chains that don't require too much work or engagement.

Programming Languages and Libraries

The best programming language for blockchain depends on the project's ecosystem and the developer's needs. Some of the top programming languages for blockchain are;

• Rust: This is a programming language created for performance and safety. It supports smart contract development and allows programmers to work with different teams. It is the best programming language for blockchain as voted by developers for 4 consecutive years.
• Golang(Go): Golang is a good blockchain programming language since it has a simple and readable structure and fast compilation time. It's an open-source language developed by Google based on C. It's ideal for building blockchain applications as a single language that allows simultaneous programming.
• C++: One of the oldest general-purpose programming languages and used as a blockchain coding language by many famous projects. It's an iconic language because Satoshi Nakamoto himself used it to create the Bitcoin chain. Other cryptocurrencies like litecoin, dogecoin and many others were also programmed with C++.
• Solidity: This is the best language for smart contract development. Solidity has all the features of C++, Python and JavaScript that's why it's the most used language for smart contract development.
• Motoko:  This is a new language created for developing smart contracts directly on the Internet Computer. The language was created with blockchain in mind so it's secure and versatile and has all the tools for convenient and fast dApps development.

For programming libraries some tools like ethers.js, web3j and light.js help interact with blockchain networks.

Ethers.js is a JavaScript library for Ethereum blockchain, web3j is a Java and Android library for Ethereum clients, while light.js is a JavaScript library for light clients.

Network Configuration for Blockchain Nodes

A proper network configuration ensures communication with other nodes and the broader blockchain network. Their network configuration determines how they interact, share data and maintain the decentralized ledger. Blockchain nodes network configuration may vary because of;

• Type of node: Full nodes that store and validate the entire blockchain ledger would need a better network configuration than a light node that stores only the essentials and relies on full nodes for validation. An archive node that keeps the entire history of the blockchain would need a better configuration than a full node.
• Communication Protocol: P2P nodes that communicate directly without intermediaries, for decentralization should be connected to each other to ensure fast communication between nodes.
• Gossip Protocol: This is a communication method that allows nodes in a network to spread information and data faster without a centralized authority. This should be used to configure blockchain nodes.

Port Forwarding and Firewall Rules

Port forwarding is a network configuration technique used to forward incoming connections from the internet to a specific node within the network. Port forwarding is important to enable blockchain nodes to communicate with peers over the decentralized network.

To do this a port is forwarded through the router to the local IP address of the blockchain node. This configuration creates a direct communication path between the node and external peers. Bitcoin's default port is 8333 while Ethereum's port is 30303. Firewall rules should also be configured to allow inbound and outbound connections while secure.

Network Synchronization and Timekeeping

Network Synchronization is simply making sure blockchain nodes are up to date with the latest blockchain state. When nodes download the entire blockchain history, validate and sync new blocks and transactions and connect and share data through peer-to-peer protocols, all of this should be done in consensus and sync with other nodes in the blockchain. Network latency should be minimized to avoid block sync delay.

Transaction data is important for transparency and verifiability in the network as it records all transactions across multiple computers in the decentralized digital ledger.

Timekeeping is also important for transaction ordering and block validation and consensus. Nodes rely on their local clocks synced via NTP and transactions must have timestamps within acceptable ranges to avoid errors or network rejection. This is important because synchronization and timekeeping ensures blockchain integrity and consensus across all nodes.

Managing Your Blockchain Node

Now you should check if the node is running. To do this you should send a request to the node with service information or you can also request data from the blockchain. Also you should monitor the node, if you get feedback about service information or data from the blockchain then it’s working.

Once your node is up and running you should do ongoing management to make it perform and secure.

Node Management Tools

After a node is confirmed to be working it should be monitored if it stops working or any software damage happens to it. It can also be monitored for bugs because they can also block it from working. Here are some popular node management tools that can be used to monitor nodes;

• Express.js: This is a popular Node.js framework that’s fast and simple. It’s used to manage servers and routes and is good for developing applications that can handle multiple requests at the same time.
• PM2: This is a manager that monitors Node.js applications, tracks bugs and sends alerts. It allows p monitoring via Command-Line Interface(CLI). Command-Line Interface, a text-based way to interact with a computer’s operating system.
• Meteor: This is a Node.js framework for cross-platform development. It can be used to code for iOS, Android and web applications at the same time.
• Webpack: This is a tool that bundles and serves assets fast and easy. It’s often used with Node.js to simplify development and deployment.
• Socket.IO: This is a framework for real-time bi-directional communication. It’s good for any device or platform and also offers real-time analytics with counters, logs and graphs.

Node.js is an open-source and cross-platform JavaScript runtime environment. Node.js runs the V8 JavaScript engine, the core of Google Chrome, outside of the browser. This makes Node.js very fast.

Security Considerations

Blockchain nodes are not easy to set up, they need space and can be costly to set up depending on the type of node and services used. To set up a Bitcoin node could cost up to $5,000 per month per node depending on the infrastructure requirements. That’s why after setting it up you should take necessary measures to secure it. Here are some measures to secure blockchain nodes;

1. Physical Security

• Host nodes in safe and secure data centers or facilities with limited access to it.
• Use a HSM to store keys and digital information to prevent tampering. A Hardware Security Module (HSM) is a physical device that stores, manages and protects cryptographic keys.
• Have backup and redundant nodes in different locations.

2. Network Security

• Password protect your node and run it behind a firewall.
• Use VPNs to encrypt communication between nodes.
• Limit node access to known and trusted IP addresses.

3. Data Integrity

• Encrypt the blockchain database to hide and protect stored data.
• Make sure every node follows the blockchain’s rules.
• Don’t share your node’s IP address publicly.

4. Monitoring and Logging

• Use monitoring tools to monitor node performance and detect anomalies.
• Continuously monitor and analyze logs for suspicious activities.
• Set up alerts for threats, bugs or node downtime.

5. Backup and Recovery

• Back up node data regularly and keep it up to date and compatible with the network.
• Store critical backups offline to prevent online attacks.
• Have a disaster recovery plan for restoring nodes in case of failure or attacks.

Implementing these measures properly will reduce the risk of attacks and your node will work smoothly within the blockchain network.

Conclusion

Blockchain nodes are the backbone of the blockchain network, ensuring transactions are validated and recorded across distributed ledgers.

As blockchain grows, more efficient, scalable and secure nodes will be needed to handle the increased usage and address issues like high energy consumption, high gas fees and slow transaction speed.

So, meet the hardware, software and network requirements and use the right tools and your node will be good to go. Whether you’re building blockchain infrastructure or dApps, a healthy node is the starting point.