ZoneBitcoin EditorialIn this article, we will see the advantages and disadvantages of solo mining. It is indeed a question that often comes up, namely, whether it is possible to mine alone, at home, in peace.
Well, if you want to mine on your own, you certainly have questions, I imagine. Do you want to mine without going through a mining pool? Well, first of all, know that it is entirely possible.
To understand solo mining, you first need to know what cryptocurrency mining is, eh. So, I'll give you a bit of theory here before getting to the heart of the matter on the advantages of mining alone.
Reminder of what cryptocurrency mining is:
To put it simply: miners are those who solve difficult mathematical calculations to properly “run” the blockchain. It is by solving these equations using their machines that blockchain transactions are validated. It is therefore thanks to miners that the blockchain can record and validate the different transactions. These “Jacques sends x bitcoin to Paul” type transactions are therefore recorded forever in a sort of digital ledger (which therefore constitutes a block chain – the blockchain).
To do a little theory, the Blockchain is simply a set of blocks each containing information about the transaction data. Each block contains an equation and is being solved by miners. To solve this mathematical problem, a miner must devote a lot of computing power (graphics cards or ASICs).
If the hashing power available to a miner is sufficient, he mines alone or joins a mining pool and obtains a share of his contribution (depending on the computing power he has, therefore).
I know that I have just summarized the work of the miner to the extreme, but I hope that it will be sufficient and clear enough all the same.
So now let's see what solo mining is and how it works.
Mining cryptocurrencies alone: how does solo mining work?
Mining cryptocurrencies alone: As the name suggests, this simply means that you will be mining alone. This means that you will do mining without going through mining pools.
A mining pool is a group of miners who mine together in the same collective, so to speak. In other words, they all combine their computing power to have a better chance of easily solving a block. Because, once again, it is by solving the mathematical problem that we “mine a block”. Thus, when the mathematical problem has been solved thanks to a “pool”, the gain is then shared between all the members of the pool. Of course, this is shared in proportion to the computing power provided by the miners.
If you want to mine cryptocurrencies alone, you will not have to register in a mining pool with other miners. In fact, and in theory, a solo miner recovers the entire gain without having to share the gains with the miners in the pool.
😎 Naturally, those who mine alone are then people who own large mining equipment and do not need the help of other miners to solve a block.
Doing mining alone is therefore very advantageous in absolute terms because if the miner succeeds in solving an equation, he does not have to share his gains. This is significantly more profitable because the miner then receives the entire block reward, the equivalent of 12,5 bitcoins! Yes!! I have 16 bitcoins.
—>> Please note that mining rewards are halved (this is called a halving) every 4 years. So, in 2020, the reward for mining cryptocurrency will be 6 bitcoins. This is also why we expect the price of bitcoin to rise.
But, this is all in theory. It is no coincidence that mining pools were invented. It's really difficult - if not impossible these days - to have such powerful mining hardware; Unless you have a mining farm…
Is Solo Mining Profitable?
The answer to the question “Is solo mining possible or profitable?” Mainly depends on two factors such as network difficulty and miner hardware power.
Besides, it feels a lot like winning the lottery….Seriously.
You may solve an equation in a short period of time or it may take months or even years to solve an equation.
The probability of finding blocks is lower when you mine solo, that's what you need to remember.
However, solo mining has the highest returns in the long term compared to mining with a mining pool. But as we said, it depends on several factors and you have to be patient. It is also demoralizing not to find a block for a long time. This is why many people who were motivated to mine bitcoins on their own eventually gave up and joined mining pools.
This is also one of the reasons why users who are new to the world of bitcoin or cryptocurrency mining will be invited to join a mining pool.
While difficulty is a factor; Inconsistency of payments is another factor to consider.
Don't consider solo mining until you have a lot of computing power (hashing power). Also note that the processor has been replaced by GPUs and that GPUs are gradually being replaced by FPGAs and ASIC. So you have to study well your mining equipment and decide for yourself whether solo mining is profitable or not.
And to help you make your decision, here are some of the pros and cons of Solo Mining.
Advantages and Disadvantages of Solo Mining:
There are pros and cons to solo mining, but ultimately it comes down to the type of coin you choose and the hardware power you have that will make all the difference.
- Advantages: In the long run, the rewards are slightly higher because there are no pool fees or transaction fees. Another advantage of solo mining is that you are not prone to pooling downtime. In this case, you can always configure a backup pool for your miner.
- disadvantages: In pool mining, you can predict payouts, but this is not the case when mining solo. Based on luck and network dynamism, you can't really predict your mining profits. You are paid irregularly.
The golden rule is not to mine yourself if your hardware is not powerful enough. If it's possible with your hash power, then you're better off solo mining. But, today, in 2020, it is almost impossible to do so for bitcoin in any case. That said, it’s entirely possible with other cryptocurrencies. It's up to you to do some speculative mining and discover the nuggets to mine before everyone else.
Since most cryptocurrencies are fundamentally similar to bitcoin, mining alone is the same and applies to all coins. If you're curious, I have some tutorial articles on cryptocurrency mining that might interest you:
If you have any other questions about mining alone or anything else (but still in the Crypto area), please let me know below.
