What is the Bitcoin Network?
The Bitcoin network is a made up of one (and only one) type of node that is defined in section 5 of the white paper.
These nodes are often referred to as miners and are characterised by an ability to produce valid blocks, distribute them to their peers (other nodes), and validate blocks they receive.
Nodes are responsible for upholding the consensus mechanism of the system based on block publication and proof-of-work. There is no other definition of a node in the Bitcoin network.
- A node constructs, distributes and validates blocks
Old nodes may drop off the network and new nodes may join at any time. There is no hierarchy in the process of block distribution or validation, making the network truly peer-to-peer.
Nodes are incentivised to maintain a high degree of connectivity with other nodes. This means that the network topology is that of a nearly complete graph. At any one time there are typically less than ten nodes that publish the majority of blocks.
Bitcoin operates on a fixed ruleset. So-called consensus rules include things such as the operation of the opcodes in Bitcoin Script, the rate at which new bitcoins are issued, the mathematical function used to calculate the target for the Difficulty algorithm and more. The protocol is agreed upon by the miners who control network operation.
There are no limits in the Bitcoin protocol. Any limits imposed are put in place by miners who are incentivised to catch the largest profitable pools of transactions they can. Miners compete to offer better service to fee paying users by scaling their own capabilities.
An example of the bitcoin network with six nodes. The topology is that of a nearly complete graph.
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