A Full Node is software that independently checks Bitcoin’s rules. It runs on a computer, receives blocks and transactions, and verifies which can be accepted into a valid history. With your own node, verification need not depend on a miner’s or another server’s claims. For your wallet to benefit, it must actually use that node as its source of data.
Imagine your wallet showing an incoming payment. How does it know that the transaction really belongs to Bitcoin’s history and follows the rules? It can ask somebody else’s server, or use your own node. A Full Node makes the second option meaningful: it independently checks the received data for validity. It does not ask a majority of connected computers how to decide. If somebody sends a block that breaks the rules, it rejects it. More connections therefore cannot replace checking the rules. Your own node lets you verify the data on which you base your payments. [1] [3]
A node checks how blocks connect, their headers and Proof of Work, the computational evidence required for a block. For transactions, it checks, among other things, that they refer to existing funds, that those funds are not spent twice, and that their spending conditions are met. These conditions are written in scripts, small sets of program rules. The node also checks how much new bitcoin is created. The running result is the UTXO set, the collection of unspent transaction outputs: a record of the particular funds still available to spend. Greater accumulated work can decide between two valid branches, but cannot make an invalid block valid. [1]
No. A Full Node checks blocks and transactions; ordinary verification alone earns no block reward. A miner instead assembles a proposed block and repeats calculations until it finds a qualifying result. This calculation uses a hash, a digital fingerprint of the block header. The roles can work together: miners need to know which history they are extending and which transactions they may include. That does not mean every node must mine. Verification and the competition to find the next block are different activities. [5] [1]
A new node first needs to catch up with the network’s history. It downloads blocks and processes their data, a process called initial synchronization. Two advanced shortcuts need to be distinguished. Under specified conditions, Bitcoin Core’s assumevalid can skip old script checks; assumevalid=0 disables this optimization. AssumeUTXO instead lets it load a snapshot, a saved set of unspent funds at a particular block, whose fingerprint it checks against a value included in the source code. It then validates earlier history in the background. Being able to work with the current state therefore does not by itself mean that historical checking is complete. [1] [2]
A Full Node need not keep every old block file forever. Pruning removes some of those files after processing, while retaining the current UTXO set and necessary recent data. The node continues to verify new blocks. An archival node keeps old blocks, so it can provide them to others or scan them again. Saving disk space is therefore not the same as being an SPV client, a client using simplified payment verification. Such a client does not check all transactions and their state in the same way as a Full Node. The distinction is about what you verify, not just how many files you store. [3]
During ordinary synchronization, a pruned node downloads and processes historical blocks before it can remove them along the way. Pruning is therefore not a switch for skipping old-block verification. Its job is to save storage. The optimizations described above are a separate matter: assumevalid may skip old script checks under certain conditions, while AssumeUTXO allows a snapshot to be used before historical checking finishes. When assessing whether a node is ready, consider both its synchronization method and its actual progress, rather than merely the size of its data on disk. [3] [2]
A wallet needs information about transactions and confirmations. When it gets that information from another server, it sends queries from which the server may learn something about its payments. Connecting to your own Full Node lets it use data verified by your node and avoid those queries to the outside server. Simply installing and starting the node does not automatically reconnect your wallet, however. What matters is the data source the wallet actually supports and uses. Your own node also does not automatically make you anonymous: privacy depends on other network data and on how you use the wallet too. [3] [4]
A node can operate without your private keys. Keys authorize payments through signatures; the node checks whether transactions and blocks follow the rules. The same device need not handle both jobs. So check more than whether your node is running somewhere: find out where the wallet reads data and how it broadcasts transactions. Independent verification cannot replace a safe key backup, nor does it remove all information that network communication can reveal. It helps with a specific part of the process: checking Bitcoin data independently. [3] [4]
The node has two different interfaces. P2P connections let it communicate with other nodes and exchange blocks and transactions. RPC is an interface through which applications issue commands and may also control its wallet. Opening an incoming P2P port for data exchange is therefore different from exposing RPC to strangers. Bitcoin Core recommends against connecting RPC directly to the public internet. For local access, it normally uses credentials stored in a .cookie file to establish an application’s authorization. This is not a web browser’s tracking cookie. [4]
Node commands let you check more than a green icon. In getblockchaininfo, check the network, blocks for the number of processed blocks, headers for known headers, and initialblockdownload for initial synchronization status. When using a snapshot, getchainstates helps distinguish the current state from historical validation running in the background. Connection count alone does not prove complete verification. Finally, check that the node has not remained at an outdated chain tip and that your wallet really obtains its data from this node. Only then does the node’s independent checking benefit your use of the wallet. [2] [1]
For the clearest picture, read this entry together with Bitcoin, Timechain / Blockchain, Transaction, UTXO, Proof of Work. The reverse links also lead from Bitcoin, Satoshi Nakamoto, Timechain / Blockchain, Proof of Work.