@Joe_Moffett… @Jared’s answer is correct that nodes do not store your coins. the coins are “stored” on the incognito blockchain.
in fact, the wallet mobile app also doesn’t store your coins. the wallet is more like a keychain. it has a set of “keys” that open a few “locks” on the incognito ledger. once these locks are opened, the wallet can see previous incoming and outgoing transactions (technical terms, UTXO), calculates the balance, and displays the balance as a single number in the app.
it may be helpful to explain how keys work in incognito. different from ethereum or bitcoin, which only offers a pair of public key and private key, incognito offers 5 different keys. you can see them by going into settings in your wallet.
we think having different keys for different purposes is a better design. one key for everything is just too dangerous. in the context of your question, there are two keys that you need to watch.
the validator key lives on your node. its only permission is to get a work permit to work in a committee and build new blocks. you cannot spend funds with validator key. so, if your server is compromised and the hacker gets a hold of your validator key, there is not much the hacker can do. the hacker can’t spend your money.
the private key lives in your wallet. it doesn’t live on your node or your server. its purpose is for spending your funds. you want to keep it safe. so please back it up .