Cost of Running a Bitcoin Node in Nigeria – Bitcoin Magazine
In this article, I list the costs of setting up and running a node in Nigeria, based on my experience running one over the past couple of years. I also offer some cost-reducing suggestions to hopefully encourage more participation on the bitcoin network.
Before exploring the costs involved: What is a bitcoin node?
A bitcoin node is software that connects to the Bitcoin peer-to-peer network. A node receives, validates and broadcasts transactions/blocks to other nodes on the network, according to the network rules. Ted Stevenot succinctly described nodes as messengers and rule keepers of Bitcoin.
The broadcast blocks are part of a distributed ledger that contains records of each transaction, keeping track of bitcoin ownership and the corresponding amount owned. This public shared ledger is generally known as Bitcoin blockchain.
A Bitcoin node is typically run on portable single board computers (SBCs) such as the Raspberry Pi, or on 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 either full or bright:
- A full node stores a full copy of the blockchain and verifies every transaction and block, starting from the first block – the genesis block – against the consensus rules. Consensus rules are specific rulesets enforced by full nodes to determine the validity of a block and its transactions.
There are two types of full nodes: archive nodes and pruned nodes. Archive nodes store the entire blockchain locally and forward it to other nodes, this also helps start up new ones. Meanwhile, a pruned node only stores a specified minimum number of blocks when verifying transactions and blocks. Therefore, more data disk is saved by pruned nodes compared to archive nodes. However, pruned nodes are not able to serve the entire blockchain of other nodes.
- A lightweight node does not enforce the consensus rules and relies on third-party running full nodes to receive block data, which involves a privacy trade-off.
Full nodes will be the main focus of this article – any mention of “urge” hereafter 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 broadcasting transactions, verifying bitcoin received in your wallet and exploring blockchain data, without third parties logging your personal information.
- Strengthening the Bitcoin Network. The more nodes on the network, the more decentralized and resilient Bitcoin is to 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 analyze the cost of running a node from a Nigerian perspective.
Hardware
The common hardware, meeting the minimum requirements, used to run a bitcoin node on is either:
- Plug and Play nodes or
- Do-it-yourself (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, and Rock Pi4, and mini PCs like the Intel NUC and Librem Mini. Some of these node providers are:
Node prices range from $300 to $700 – excluding shipping ($100 minimum to Nigeria) and customs – depending on hardware and storage size. Currently, international purchases made on most Nigerian Naira debit cards are capped at $20 per month, down from a previous $100 limit. Your node purchase options are to use a dollar debit card – linked to a home account – with deposited dollars sourced from the black market (currently 70% above the official rate), use a virtual dollar card which offers convenience but at a higher rate than the black market and bitcoin.
There are other obstacles you may encounter when purchasing a node. Firstly, not all node providers ship to Nigeria. Additionally, due to chip shortages, some of these products are sold out. One way to overcome some of these obstacles is to use the option that node vendors take to source node components themselves, and install their respective bitcoin core firmware on the assembled node.
DIY Node
When purchasing 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 + cabinet
- Refrigerator/fan
Current chip shortages and high demand for single board computers have led to a massive increase in prices and supply shortages, especially Raspberry Pis both locally (used and new) and internationally. However, some Raspberry Pis and RockPro64s are available on Aliexpress. In any case, there are some fake sellers on the platform, you need to be especially wary of newly created stores, read negative reviews and ask for a refund if an item does not arrive within the estimated period.
Considering the international purchase limit on Naira debit cards, these SBCs must be purchased with a dollar card – there is no bitcoin purchase option. The table below summarizes average hardware component costs from Aliexpress, to build new Raspberry Pi or RockPro64 nodes.
Data
Before a node can perform its role as messenger and rule-keeper on the bitcoin network, it must be synchronized with other nodes on the network. This is done by downloading and verifying all the blocks from the genesis block in a process known as Initial Block Download (IBD). Currently, the bitcoin blockchain is approximately 440 GB in size.
The table below summarizes the average data costs, from network providers, for IBD and the approximately 5.3 GB required monthly to synchronize your node with the blockchain. This assumes you are in an area with some reliable 4G network coverage.
Power
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 need a solar generator to power the node and router, which is not ideal as it is weather dependent. Replicating something similar to Chimezie Chuta’s Spacebox entails the subsequent average costs.
Finally, the estimated full node setup costs are tabulated below.
To conclude
Running your own Bitcoin node has many advantages, some of which were listed earlier. However, with ongoing chip shortages, inflation and node setup costs (despite the assumptions and cost reduction recommendations here), it may not be possible to run a node for everyone. A practical solution would be to implement Arman The Parman’s circle of trust idea or Obi Nwosu’s guardian and user model to allow a technical person to run a node for a trusted group of people such as close friends, a family or a community. This approach involves a trade-off, but is much better than connecting to third-party nodes and helps ease bitcoin’s escrow challenge.
This is a guest post by Chinedu. Opinions expressed are entirely their own and do not necessarily reflect the opinions of BTC Inc or Bitcoin Magazine.
