Everyone with access to a computer can become a part of the blockchain system by installing particular software. Using the software enables blockchains to store the data of their users, and at the same time is the answer to the question: how is blockchain stored.
Blockchain is stored in computers or servers that participate in the system all over the network. Every personal computer joined to the network is recognized as a node and owns a copy of the chain. This network of nodes makes the blockchain system fully decentralized, meaning there is no single party that owns or stores it.
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What Exactly Is Decentralization and How Does the Nodes Network Store Blockchain?
The idea of decentralization is the core of blockchain’s purpose. Independence from centralized institutions like the government, banks, companies, or any other parties that store or use personal data is the focal point of the chain system. Still, the fact that there is no centralized controlling party to check or validate the transactions doesn’t mean this system is less secure. Quite the opposite!
Decentralization Grants Greater Security of Data Storage
A decentralized system has its own control principles that imply every node (computer) in the network has to validate every requested change. Once the consensus is reached, the data is stored in a block of information, immediately connected, and added to a database of every node in the network.
All this means that once the information is stored within the chain, it can not be changed, deleted, or lost. All information is chronologically stored, while every transaction is entirely traceable and private at the same time.
Nodes Make Decentralization Work, and the Whole System Can Run Safely
Thanks to the node network that fuels the blockchain, it is impossible for one party to exclusively possess or corrupt it. The nodes that run the chain actually control it, store it, and are its greatest protection. Every time a new request is validated, it is added to the block of information, which consequently helps a new block to be opened. Nodes are, in essence, how blockchain works.
What Are the Main Advantages of Decentralization That Made Cryptocurrencies Like Bitcoin So Important?
It is believed that blockchain technology is the biggest invention made after the internet. Besides being promising when it comes to financial and personal freedom in a time when our privacy is being intruded upon more and more, it also gives broader opportunities for reshaping the system of how business is done.
Here are some of the main perks of using this technology and cryptocurrencies in general:
- Full support for peer-to-peer transactions and avoiding intermediaries that increase business expenses.
- Greater privacy – all your personal data is encrypted and fully private. Your name, address, or any other personal information won’t be visible to anyone.
- Greater safety – the biggest worry of most users is having digital assets hacked. However, thanks to advanced encryption models and the fact that the whole node network has to confirm the requested change – your assets are safe.
Full and Masternodes Fuel and Store the Blockchain Decentralized System
Blocks are stored within the node network. Or, in other words, in every PC which participates in its system, regardless of whether it takes part in mining or not. Once the blockchain software has been downloaded, the PC becomes a full node – or part of the network. This installation implies that previous transaction history, or what is also called an immutable ledger book, will be stored in the PC and that a full node will participate in validating transactions.
Masternodes Also Have a Great Influence on How Blockchain Functions
Expectedly, the memory of the hardware and the configuration of the computer itself are deciding factors in its ability to support the system. In the beginning, only a few computers were enough to keep the chain working. However, with the rise in numbers of those who use cryptocurrencies, the need for a fast system capable of storing and supporting all requests 24/7 became imperative.
This is how masternodes were made. Masternodes are something like a very large server on the network that requires more resources than a full node. While a full node requires a single computing device with better configuration, the masternode requires electricity, storage space, memory, and maintenance at much higher capacities. Here is how the basic requirements look:
|CPU||1 x 1 GHz||1 x 2 GHz|
|RAM||2GB + 2GB swap||4GB + 4GB swap|
|Network||400GB per month||1TB per month|
The role of masternodes in the whole system is to validate the transactions full nodes submitted. Besides, masternodes also regulate some other more complex procedures like voting on proposed changes to the ecosystem or executing protocol operations.
Masternodes Are a Fertile Field for Crypto Investors Looking for a Passive Income
However, not everyone can participate in the process as a masternode. There is usually a necessary investment in cryptocurrency and advanced hardware as requirements. At the moment, there are more than 4,100 different active masternodes.
Depending on your capacity to invest and the specific cryptocurrency, you’ll need anywhere from less than $1 to $1 million to enter the masternode network and secure passive income and return on investment.
There Are Blockchains Other Than Bitcoin You Can Invest In
Undeniably, Bitcoin is a cryptocurrency that introduced and popularized the blockchain technology. However, this technology includes much more than Bitcoin. The system makes it possible to create new blockchains, cryptocurrencies, or contracts. Just in 2021, there were 731 new cryptocurrencies introduced, which further proves how potent this technology and field for investment are.