Umbrel To Offer Plug-And-Play Bitcoin Node Server

Umbrel partnered with The Bitcoin Machines to offer a plug-and-play all-aluminum node and server combo.

Umbrel, an operating system (OS) purposefully built for running a Bitcoin node, Lightning Network node, and other self-hosted applications on a Raspberry Pi, announced today a partnership with Bitcoin node hardware maker The Bitcoin Machines to offer a plug-and-play Umbrel server solution.

“The server features a beautiful all-aluminum design with a 1.8″ display, and is powered by a Raspberry Pi 4 with 1.6Ghz quad-core CPU and 8GB RAM, with the option to choose between 1TB and 2TB SSD for storage,” the company said in a release sent to Bitcoin Magazine.

Image via press release

Image via press release

Umbrel overjoyed non-technical users in the Bitcoin community when it debuted due to its focus on usability, user interface (UI), and user experience (UX). Still, users had to install the OS on a Raspberry Pi manually. The new offering seeks to bring the ability to run a Bitcoin node for even more people as all the user needs to do is plug the prebuilt device into their routers, with no configuration required. The server is already available to order at The Bitcoin Machines store, at $429 for the 1TB option and $559 for 2TB.

“Ever since we launched, people have been constantly amazed at how easy it’s become to run your Bitcoin and Lightning Network node, and now an entire personal server, with Umbrel,” said Mayank Chhabra, Umbrel’s cofounder and CEO. “But from a hardware standpoint, assembling your own Umbrel server…still requires multiple steps which can be intimidating for many.”

Image via press release

Image via press release

“This is why we’re so excited to partner with The Bitcoin Machines to offer a plug-and-play Umbrel server,” Chhabra added, “you literally just have to connect the device to your router, turn it on, and that’s it! Digital self-sovereignty and privacy just became much more accessible to the masses.”

Running your own Bitcoin node is vital for many reasons, but perhaps the most critical is that it is the only way for you to know for sure how much bitcoin you have. A node is the only way for you to truly enjoy Bitcoin’s property of trustlessness; if you don’t run a node yourself, someone is running one for you.

Umbrel started as an OS that sought to provide mainstream adopters with an easier-to-use way to participate in the Bitcoin peer-to-peer network. More recently, however, the OS expanded its offerings by enabling ten new self-hosted applications in its app store. Users were then able to set up their own self-sovereign, private solutions, including file hosting, messaging, photo and video hosting, among others.

Umbrel x TBM 3


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A Gentle Introduction To The Lightning Network

*This article assumes the reader already has a basic understanding of the Bitcoin protocol, as well as how nodes, users and miners interact within it.

Bitcoin is extremely secure, but this initially came at a trade-off: It’s slow. On its base layer, there’s no getting around the immense computing power and 10-minute average block time — and that’s the point. Bitcoin’s maximum transactions per second (TPS) is about five, which immediately raises concerns about scalability that enable millions of users to take advantage of its use case: a permissionless, peer-to-peer currency.

Enter the Lightning Network. Lightning was proposed in a white paper by Joseph Poon and Thaddeus Dryja in 2016. At 59 pages, it’s a serious read, but it’s nothing short of genius. It overcomes this scalability problem without sacrificing security or trustlessness, and increases anonymity in the process.

There is often discussion regarding protocols built on Bitcoin, and whether or not its users are interacting with “real” bitcoin. This is a fair question in this context, as it’s not immediately obvious how Lightning users are interacting with “real” bitcoin while having near-instant transaction times and almost zero fees.

The Lightning Network itself consists of two things: nodes and the channels between them. These nodes must also serve as nodes for Bitcon’s base layer, as that’s how they open and close channels between nodes.

Bitcoin can only be added to the Lightning Network by creating a channel between two nodes. The bitcoin is placed in an unbroadcasted transaction which both nodes verify and sign. This channel can be funded by one or both of the nodes. This means that

1. This bitcoin cannot be used for anything else until that transaction is broadcast to the network.

2. Both nodes have the ability to “redeem” this transaction at any time in order to get back their initial channel funding amounts.

There is a lot of effort and nuance in operating a Lightning node. Node operators are incentivized, if nothing else, to establish many channels by the accrual of routing fees. Fees must be competitively priced, though, in order to have transactions routed through their node. It’s also suggested that operators have multiple channels to increase network connectivity and make channel rebalancing easier.

A natural side effect of Lightning Network operation is the pooling of funds in one channel or another. This restricts liquidity in certain neighborhoods and so necessitates the “rebalancing” of channels in order to have a more even liquidity gradient across the network. Maximum transaction size — at least used to be — limited by the smallest channel balance. This is, interestingly, being worked on by Rene Pickhardt and Stefan Richter. Operators are also encouraged to open large channels — usually at least one million satoshis — in order to allow for larger transactions through their channel(s). Operators are also incentivized to keep their channels open for as long as possible, as closing them requires a drop back down to the base layer, incurring potentially high transaction fees.

Channel operators are incentivized to cooperate with each other. The largest concern is a channel constituent closing the channel by themselves, broadcasting an incorrect transaction (i.e., channel state, which shows the channel balance per side at any given time) back to the base layer. But they aren’t able to access that bitcoin for a period of time. If, during that time, the other channel constituent can show a more recent channel state, the malicious channel constituent loses all of their bitcoin. This can also be enforced by Watchtower nodes.

Smoothly operating Lightning nodes and channels can be very time consuming. Thankfully, there are large communities devoted to education and getting everyone, including your grandma, into Lightning.

Lightning improvements are currently made by several organizations, including Lightning Labs, Blockstream and ACINQ. Despite being individual groups, they keep their products interoperable by utilizing agreed-upon development rules.

As Lightning is still very much a work in progress, security issues and vulnerabilities will inevitably arise. That being said, it has come a very long way in just a few years. At the time of writing, it has over 20,000 public nodes, 60,000 channels and 2,000 bitcoin in capacity.

As Lightning makes it unnecessary to confirm every transaction on the base layer blockchain, the possible upper bound of TPS steadily trends toward infinity. This also pushes transaction fees to near-zero.

Interacting with Lightning is not very different from interacting on the base layer. You can still use your own node, or someone else’s via a custodial or noncustodial wallet. Now, instead of trading addresses, we exchange invoices, which encode, among other things, where the bitcoin is going, and how much is going there. These transactions are sent via onion routing, which means no node between the sender and recipient knows who is sending and who is receiving. Lightning dramatically increases fungibility this way. With the enactment of Taproot, it will become difficult to even ascertain whether or not bitcoin is being transacted on the Lightning Network.

In order to remove bitcoin from Lightning back to the base layer, a channel must be closed, a loop out can be performed, or a submarine swap can be performed. You can do these yourself, if you are utilizing your own Lightning node, or you can let someone else do it via an aforementioned wallet.

Luckily, there is a flurry of activity surrounding Lightning onboarding and development. Worldwide adoption is in the sights and in range, and it’s going to need all hands on deck.

This is a guest post by Nameless. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc. or Bitcoin Magazine.


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Six Reasons Why You Should Run Your Own Bitcoin Node

Let me explain quickly that a Bitcoin node is any computer which runs a piece of software (Bitcoin Core) that has some important jobs:

Your Bitcoin node needs to keep a copy of the entire Bitcoin blockchain. It has to connect with other nodes, forming a network of communication, which propagates transactions (transactions are kept in a “mempool”, i.e., the queue of transactions waiting to be included in the next block, and thus added to the blockchain). It needs to check that all additions to the blockchain are valid, and reject those that are not valid. It will provide details about the blockchain — such as balances — to other types of software that ask, like wallets. And it will provide a copy of the blockchain to any new node that wants to join. The new node then independently checks that every transaction in the copy it receives is valid. It does not actually “trust” the connected node.

To run a node, you download Bitcoin Core software, and then let it copy the blockchain from other nodes, and your node verifies each block itself. You then leave it on, and new blocks are received roughly every 10 minutes (the blocks contain transactions taken from the mempool). Your node will check if the block is valid, and if so, add it to its copy of the blockchain.

A dodgy block gets rejected, not because everyone else rejects it, and not because everyone copies their neighbor, but because the block is invalid according to the rules contained in the Bitcoin Core software, and everyone else that is running the same software will also reject that dodgy block.

Your Bitcoin wallet does not keep a copy of the blockchain, and is usually separate from Bitcoin Core (although Bitcoin Core does have a wallet feature). Your wallet just holds your keys. It has to ask a Bitcoin node, “Hey Mr. Node, this address of mine, does it have any bitcoin in it?” Technically that’s not quite accurate, but this is sufficient for now.

Running your own node means you don’t ask other people what their copy of Bitcoin Core is doing. It’s your own copy of Bitcoin Core, and you don’t need to trust other people. Your wallet can ask YOUR copy of the Bitcoin blockchain (making the digital connection between your wallet and node is the technically challenging and critical part, not just running the node — an article for another day).

So with the preamble done, let me next explain why it is important to run your own node:

Reason 1


When your wallet tells you your bitcoin balance, it asks a RANDOM public Bitcoin node what balance each of your addresses contains. It then gives you the results, and you see your total bitcoin in that wallet. Even empty addresses which you haven’t used get queried. Surveillance companies run some of these nodes. “What the Hell?” Yes, it’s true.

You are telling a random entity, possibly a surveillance company, your IP address (which can be used to identify you), and that you have a Bitcoin wallet, and ALL of your current and future addresses you’ll use within that wallet, and all the balances of all those addresses, now and later. Providing this information to surveillance companies is dangerous for many reasons. For example, this data can be leaked intentionally — to the government when requested — or unintentionally (to hackers). Governments may target Bitcoiners with heavy wealth taxes or confiscation, as the US government once did for gold with order 6102 in 1933, and hackers may target you to extort or trick you out of your bitcoin.

Reason 2

You can confirm for yourself trustlessly that you are receiving real bitcoin.

For example, when you sell something, a technically sophisticated buyer could potentially manipulate which node your wallet connects to. They could send you counterfeit bitcoin, and your wallet would think it’s received real bitcoin because the malicious node lied to your wallet. Granted, this is very unlikely, but the fact that you can prevent it by running a node makes the development of this kind of attack not interesting or fruitful. What actually happens with this attack? The scammer somehow gets your Bitcoin wallet to read the wrong blockchain from a malicious node. He moves supposed bitcoin on THAT blockchain, not the real one, and your wallet thinks you’ve been paid.

If you get scammed in this way, you may accept this counterfeit as final payment, and may send goods in exchange for the fake bitcoin. One day, when you connect to a genuine Bitcoin node, your wallet will show that you never in fact received bitcoin. Your balance will be lower than what you thought it should be, because the fake transfer never existed on the real Bitcoin blockchain.

You can prevent this by connecting your wallet to a node you trust, but even better is to connect to your own node. “Don’t trust, verify,” is the Bitcoiner’s mantra.

Not doing this is kind of like accepting gold as payment, and asking a random person to use their XRF analyser to check if the gold you received is real. You don’t know if that random person is on the side of the buyer, or if they are honest.

You might ask, “No trust? Wait, aren’t I trusting Bitcoin Core when I download it? How do I know THAT’s not fake?” Yes and no. There are ways to verify that the software you downloaded is genuine, but that’s not for this article.

You might then ask, “Aren’t I trusting the developers that the genuine copy is behaving as I expect?” Actually yes, unless you write the software yourself, or read the code, or pay someone to read the code — but then you are trusting them. There has to be some level of trust, but the idea is to keep it to a minimum. (Just saying that might get me in trouble with the Bitcoin mob, shhh!) Most people (me included), can’t and won’t read the code, so there is some element of trust. The trust is that hundreds, maybe thousands, of developers’ eyes are going over the code looking for errors and problems before it is released. It’s not easy to make changes to Bitcoin Core, and this is a feature, not a bug. Using the gold XRF analyser analogy, you are probably not going to build one from scratch to check whether or not your gold is real, and that’s okay.

Reason 3

Defend the Bitcoin rules from unwanted changes — like scarcity or block size.

If a group of “powerful” people banded together, as they did in 2017, and decided to try to change the rules of how Bitcoin works (for example, by increasing the block size), you can choose to not upgrade your node to the new system and keep your current node. If you are more than the minority, there will be a pool of people running the unchanged Bitcoin Core and a pool of people running the changed version — a fork. This is how Bitcoin Cash was born. The new version was unanimously rejected, but those who lost the war kept running their nodes and mining bitcoin cash as well. Those who owned bitcoin then also owned bitcoin cash. For a given address, there was one balance on the Bitcoin blockchain, one balance on the Bitcoin Cash blockchain.

If you weren’t running your own node at the time, you had no say in this war. Your wallet might have connected to a Bitcoin Cash node and someone might have paid you in bitcoin cash instead of with bitcoin. You then might have given up your goods in exchange for coins that didn’t meet the monetary policy you preferred.

Reason 4

If you run a node, and leave it on 24 hours a day, this helps the network.

The more nodes that are running, the faster transactions can propagate for everyone, and the harder it is to shut down Bitcoin. In order to kill Bitcoin, every single copy of the blockchain must be destroyed.

Reason 5

Be an “Uncle Jim”.

In the future, it may be too challenging for EVERYONE to run their own node, but we don’t want people trusting random nodes. I imagine there will be a technical person in every social “circle of trust” (“Uncle Jim”) for people to connect their wallets to. This tiny trade-off is far better than connecting to random public Bitcoin nodes.

If you learn to run your own node, then YOU also become a kind of human node, because you could one day help someone else to run and use their own node.

Reason 6

Coolness factor and street cred.

Running your own node is super cool, and gives you a great appreciation of the power of Bitcoin. You’ll probably end up buying more.


Hopefully, it is clear now why you should run a node. There are various ways. If you want individual help, see here. For the computer illiterate, help is available at

This is a guest post by Arman the Parman. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.


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A16z taps Deutsche Telekom subsidiary as Celo validator

The United States-based venture capital fund Andreessen Horowitz (a16z) has picked T-Systems MMS validator group, a subsidiary of Deutsche Telekom, to delegate its native Celo (CELO) assets.

According to a notice on Deutsche Telekom’s website on Tuesday, T-Systems MMS is running the validator nodes via the company’s Open Telekom Cloud which reportedly delivers robust security capabilities.

As previously reported by Cointelegraph, Deutsche Telekom invested in Celo back in April, becoming the first telecom firm to join the Celo Alliance for Prosperity. At the time, the company also purchased a significant amount of the mobile decentralized finance platform’s native token — CELO.

T-Systems MMS is staking its parent company’s CELO tokens as well as other Celo-based assets held by a16z.

A16z has been a supporter of Celo and has regularly participated in capital raises for the open-source blockchain payments project. Back in April 2019, a16z joined Polychain Capital and other investors in a $30 million funding round for Celo.

Commenting on its choice to delegate its Celo assets to Deutsche Telekom subsidiary, a16z general partner Katie Huan said:

“Electing a diverse set of globally distributed validators is critical to maintaining a blockchain network that is secure and technically robust. We partnered with Deutsche Telekom because their incentives align with Celo’s vision of building a global payment platform that can be used by anyone with just a mobile phone.”

Related: Deutsche Telekom invests in mobile DeFi platform Celo

Apart from Celo, T-Systems MMS is a node operator on Chainlink (LINK) with the company also providing support infrastructure for Flow, another blockchain project. Andreas Dittrich, the company’s blockchain head, describes public blockchains as “the future of value-based collaboration.”

CELO, like the rest of the crypto market, is currently experiencing a significant downturn since setting a new all-time high of almost $7 back in April. As with other altcoins, CELO’s price decline has seen the token lose close to 74% from its April high.