Setting up a cryptocurrency or blockchain node is an excellent way of supporting individual projects. For Ethereum, the number of nodes will become even more crucial once Ethereum 2.0 officially goes live. So far, it appears that most users still rely on third-party hosting services for this purpose.
Where To Host Ethereum Nodes?
Running a fully capable Ethereum network node requires a computer capable of handling the workload and a 24/7 connection to the internet. Although one can use devices such as a Raspberry Pi 4 to run the software, it is an option that still has a bit of a learning curve. Many newcomers will opt for an easier and more straightforward option to support the network. However, this creates an extra layer of centralization, which may not be all that great.
To be more precise, 65.12% of all Ethereum nodes are on “hosting“. This indicates the use of third-party services and platforms. While it is a way of supporting the network, it is not the most ideal option either. If a large number of those nodes gets shut down by the service provider – for whichever reason – the network will suffer.
Currently, 51.14% of hosted nodes are live on Amazon’s AWS. A problematic scenario, as Amazon remains a bit tricky when it comes to cryptocurrencies. Hetzner Online GnbH, Alibaba, Contabo GmbH, and Digital Ocean are also popular third-party hosting providers today. Surprisingly, Microsoft has only 1.33% of the market share.
Residential nodes are also well-represented, although the 31.07% market share leaves somewhat to be desired. It is interesting to see how China and the US are well-represented as locations with residential nodes, whereas every other country – except Germany – is nearly non-existent. It is another sign of potential centralization concerns.
Business And College Nodes Need To Increase
Two aspects that seem a bit lackluster are the number of “business” and “college” nodes. Although this latter segment will always be relatively small, one would expect more businesses to embrace Ethereum today. However, these companies are more likely to use third-party hosting solutions for their network node instead of running it locally.
With just 24 nodes listed as “college” for Ethereum, it is somewhat surprising to see Croatia top the list. The Croatian Academic and Research network is well ahead of China Science and Technology Network and Syracuse University. It may take a while to get more node connections from college ISPs, as not all institutions allow for running this software.
Whether this landscape will change once Ethereum 2.0 goes live remains uncertain. As mining becomes obsolete and stakers become validators, there should be a significant increase in overall node activity. Finding the right place to host them will be essential, as every node is a potential target for hackers.