What to look for when analyzing nodes?
When studying blockchain, it is important to consider all the risks to which it may be exposed. The critical point of vulnerability are nodes. Exactly what risks can they be exposed to?
Number of nodes
For any network, there is a minimum critical number of nodes. And if their number becomes less than this number, the network is at risk. What is the minimum number of nodes a blockchain must have? It ultimately depends on the blockchain platform, if it's public or private, its trustless state and the consensus algorithm being used (PBFT, PoW, PoS, DPoS etc) but, taking the example of a private, distributed ledger with Byzantine fault tolerance, then 7 nodes is the recommended minimum to provide the required 66% or greater node agreement with a tolerance of two bad actors.
The maximum number is theoretically unlimited. But as the number of nodes increases, each of them must have the current state of the network. To do this, the nodes exchange information with each other. And the more nodes in the network, the longer the state is distributed in it.
For example, the Bitcoin network has 15414 nodes on 10/23/2022, Ethereum has 7553. When there was a blockchain hype for Chia in May 2021, the number of nodes was as high as 500,000.
Geography of nodes
Blockchain is essentially an international network. Nodes can be located in any country. And a significant concentration of nodes in one country can lead to geographical risks. If, for some reason, cryptocurrencies and related activities are banned in a particular country, the network could be affected. For example, China banned mining in 2021, many miners stopped supporting blockchains, including Bitcoin.
Distribution by hosting providers
In blockchains with a consensus algorithm other than Proof-of-Work, nodes are simply software, without hardware. That's why nodes are often installed at cloud storage providers, such as AWS. And if most of the nodes in one blockchain are at one provider, the blockchain begins to depend on the performance of that provider.
When we studied the Solana blockchain, we noticed that almost 69% of the validators are hosted by just two providers - Hetzner Online GmbH and OVH SAS. And although the servers of large companies are distributed geographically, the centralization of the service provider plays a more important role here. Judging by customer feedback from Amazon Web Services, servers at such a seemingly reliable provider crash regularly.