I asked this question on IOTA's forum here:

Real incentives for running a full node?

One of the founders from IOTA Come-From-Beyond (Sergey Ivancheglo) responded with this comment:

"However, given that IOTA collects no fees and does not reward node operators, what actual plausible incentives exist for running one?" -- How are Bitcoin node operator rewarded? Answer my question and you'll probably get the answer to your own question.

I'm curious how someone knowledgeable about Bitcoin would respond to this question and comparison? Can this question about IOTA's network incentives and viability be answered by asking the same question about Bitcoin?

What are your thoughts about this?


As a bitcoin user, it is beneficial to run a full node because that allows you to independently validate the current state of the network yourself, without having to trust the actions or information of a third party. The user receives no monetary reward, but the ability to trustlessly interact with the bitcoin network is a very important feature, that is very core to any decentralized cryptocurrency network.

As an Iota user, you cannot attain the same level of trustless interaction. As I understand it, Iota employs a ‘coordinator node’ that basically has admin rights to the network, so you must trust that the coordinator will not act maliciously, or be otherwise compromised. You can run a node to check transactions yourself, but if the coordinator decides to freeze your coins, having a node will not help you.

So I wouldn’t agree with the comparison, or at least I would argue it is not a good line of reasoning. The level of trustless interaction that is enabled by running a bitcoin node is simply not possible to achieve in Iota due to the existence of the centralized coordinator position.

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