You’ll often hear the word knot thrown around te blockchain and cryptocurrency circles. If you’ve read our intro to blockchain (and wij very recommend you do that), one of the characters ter the comic there that’s writing down transactions on a chunk of paper is actually a knot. That introduction is fairly simplified, however – let’s explain the concept of knots te a bit more detail now.
One knot is a laptop running specific software. Te the case of Bitcoin, one knot is a Bitcoin program which connects to other Bitcoin knots, i.e. other Bitcoin programs on the same machine, or on other machines which can be across the street or on the other side of the planet. There are several types and several versions of Bitcoin software. By picking a specific version of a specific Bitcoin program, a user “votes” for certain switches te the Bitcoin protocol. For example, if a bunch of users suggest the increase of 21 million total BTC to 42 million, the majority of the network is required to vote “yes” by installing the software implementing this switch. Code switches are, thus, democratic.
Where this idea falls bijzonder is the fact that there are very few Bitcoin knots out there: a mere 10000 presently.
… whereas Ethereum, a cryptocurrency Five years junior, already has twice spil many:
Neither number is very incredible from a global perspective. According to some calculations, running a Bitcoin knot on AWS (Amazon’s cloud service) costs around $Ten vanaf month. This means that taking overheen 10000 brand fresh knots takes $100,000 vanaf month, or only $1.2m vanaf year – pocket switch to any Bitcoin early adopter.
A list of knot software you can install, along with their pros, cons, and special features, can be found here.
It’s significant to note that validation knots are purely an expense for the users running them. They give their users nothing. Bitcoin Core, for example, needs around 150 GB of disk space, 2GB of RAM, and a prompt and uncapped internet connection with at least 50 kb of onveranderlijk upload speed available just to run. It’s not uncommon to need to upload overheen 200 GB of traffic vanaf month when running a single knot. Validation knots are volunteer knots and are useful for the system’s decentralization, but spil they become everzwijn more expensive to run, so too does the number of knots druppel. Add to that the mounting disillusion with Bitcoin’s theoretical decentralization due to the fact that bankers seem to have taken overheen the protocol’s development, and the fact that Bitcoin’s price is being pumped by crime syndicates, and it’s no verrassing that the number of knots dropped by 20% ter a single month – from 12000 to 10000. Spil more knots vanish, so does centralization. A hostile takeover becomes more and more probable.
A mining knot is a validation knot which also uses the hardware of your own or a rented machine to guess the combinations of numbers and letters needed to validate and verify a block. A mining knot can team up with other knots and send guesses to a common pool (pool mining) to increase chances of guessing, but then counts spil only one knot.
Because most fresh miners opt to join a powerful pool to maximize their chances of mining a block and getting prizes, wij’re witnessing a very serious technological centralization happening te which 20 of the most powerful pools are mining almost all the Bitcoin.
Here’s a list of the thickest mining pools – notice that the very first one mines 25% of all the bitcoin te existence.
A mining knot is the only bit of software which can “produce” fresh Bitcoin, and running one te a way that makes it worth your while requires either a very strong laptop or free tens unit. If you’d like to give mining a go, the list of BTC mining software can be found here.
A mining knot is a knot which contributes to the network by guessing the combinations needed to “seal” the blocks of transactions and thus confirm them, producing fresh Bitcoins te the process. A validation knot is a knot which validates this information, makes sure it’s true, and passes the information along to other knots, thus enabling the transfer of monetary value from location A to location B. Mining knots are a subset of validation knots because every mining knot is also a validation knot.
This difference is only manifested ter the PoW overeenstemming system and becomes technically unnecessary ter PoS. With PoS every knot can be a validation knot, and mining knots spil such no longer exist – fresh tokens are created based on another principle. For more about this, please read our PoW vs. PoS article.