CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
US English

What are nodes? 


In the cryptocurrency world a node is a computer, or group of computers working together, that supports a crypto network through the verification of transactions and maintenance of the blockchain, or the digital ledger. 

Information on any of the numerous crypto ledgers is typically distributed throughout a network of nodes. Nodes are an integral piece of distributed ledger technology (DLT) that store crypto ledgers across a vast network of unconnected computers, thus making the ledger immutable to corruption at a single point. 

Nodes can be considered communication endpoints that any user or application wanting to interact with the blockchain can communicate through. In this sense, the node meaning can also be considered as a redistribution point for communications. 

What are nodes?

Nodes explained

Every device connected to the blockchain is considered a node and that there are multiple different types of nodes. Nodes are required for the success of peer-to-peer network integrity, and as such guarantee the validity of the blockchain. As they form part of an unconnected network they are quickly able to identify any attempt to corrupt the network and disconnect the offending node. This is the cornerstone of decentralised blockchain technology and one of the main reasons crypto is so appealing to general consumers. 

Types of nodes 

Although there are numerous variations, nodes are typically categorised within one of the broad basic functions of:

  • Processing transaction volume

  • Validating transactions

  • Storing the digital ledger

  • Communication point for interaction with the blockchain 

Types of nodes

Within this broad scope there are three main types of nodes. These are full nodes, lightweight nodes and super nodes (listening nodes): 

  • Full nodes’ main function is to continuously verify the validity of the blockchain in its entirety. Full nodes compare newly added digital information to previously validated versions of the blockchain and automatically reject any deviations from the proven ledger. 

  • Lightweight nodes perform a similar function to full nodes in that they are used to verify whether a transaction is legitimate. They differ in so far as they do not store the full blockchain and do not verify transactions against the entirety of the blockchain.

  • Super nodes (listening nodes) are similar in scope to full nodes but are visible to the public rather than hidden behind a firewall. They can relay information or communicate the status of the blockchain to any other node that tries to establish a connection with it. Supernodes are integral in validating the blockchain stored on full nodes throughout the distributed network. 

Many crypto enthusiasts run nodes voluntarily as a way of strengthening the development of an alternative money market to compete with traditional fiat currencies. These nodes guarantee the continued integrity of many cryptocurrencies and ensure any attempt to corrupt them is quickly identified and removed from the network.  

Related Terms

Latest video

Latest Articles

View all articles

Still looking for a broker you can trust?

Join the 610,000+ traders worldwide that chose to trade with

1. Create & verify your account 2. Make your first deposit 3. You’re all set. Start trading