While you probably missed out on the chance to mine Bitcoin (BTC) on your laptop in the early years of Bitcoin, there’s good news for those who still want to get into at-home mining. Stories have emerged of only Bitcoin miners finding new blocks to receive block rewards.
Read on to learn more about solo Bitcoin mining and how it is seemingly making a comeback.
What is bitcoin mining? A quick recap
Before we dive into solo Bitcoin mining, let’s quickly recap what Bitcoin mining is and how it works.
- In addition to securing the whole network, Bitcoin mining is also the process by which the Bitcoin network processes transactions and how new coins enter into circulation.
- Mining involves the deployment of hash power, or computational power, using specialized mining hardware to make complex calculations. The miner who finds the solutions first wins the block reward, which is now BTC 6.25. It’s set to decrease around every four years. The next halving is estimated to happen in 2024. Now, around BTC 900 are mined per day.
Early days of BTC mining:
Bitcoin mining can be done alone (as a solo miner) or by joining a mining pool. Mining pools enable miners to pool together their computational power to increase the chances of winning block rewards. Block rewards are the proportional split among all pool participants.
Most Bitcoin miners take part in mining pools. However, there are also those who prefer to try their luck as solo miners.
What is only mining?
Solo mining (as the name suggests) refers to mining Bitcoin (or any other proof-of-work (PoW) cryptoasset) alone without joining a mining pool.
pool miners who contribute their computational powers and resources to mine Bitcoin, only miners don’t rely on any other party to mine. Rather, they discover blocks by connecting their mining devices to their bitcoin wallets, and that’s it.
If a solo miner then manages to have “insane luck” and find a new block, they will earn the entire block reward, which may mean life-changing money for the lucky individual. However, to stand a chance at finding a new block, only Bitcoin miners typically require a substantial at-home mining setup to have enough hash power to compete. Moreover, the Bitcoin network’s mining difficulty also plays an important role in the likelihood of winning a block reward.
Someone just mined a Bitcoin block: Here’s what happened
Solo mining is suddenly a topic of conversation in the Bitcoin community again because stories have emerged of solo miners winning block rewards.
And let’s not forget that the current Bitcoin block reward is 6.25 BTC, which amounts to over a quarter of a million dollars at today’s prices. For most people, that’s life-changing money.
In January, Cryptonews.com reported about a solo miner with only 126TH in hash power finding a block to earn USD 266,870 in BTC as a reward. The story was broken by ck only‘s administrator, Con Kolivas, who congratulated the lucky miner and user of this solo mining pool.
Solo CK enables at-home miners to avoid the costs of running a full Bitcoin node while remaining “connected to high-speed low latency Bitcoin nodes for rapid block change notification and propagation.”
“Response to this has been extraordinary, but bear in mind people have been mining only since day one on Bitcoin; the difference is the only mining hashrate gets proportionately less with every year,” Kolivas commented further on the story.
About a week later, another single miner hit the jackpot, winning over half a million dollars after winning an Ethereum (ETH) block, netting them a hefty ETH 168 (USD 524,000). The Ethereum miner managed to find a block with an average hashrate capacity of 2.19GH/s.
The lucky individual only started mining in late December, which makes this story even crazier.
Should you start solo mining at home?
With the recent stories of solo mining winning hefty block rewards making waves, it’s tempting to ask yourself the question of whether you should start solo mining too?
Let’s take a look at the facts.
Bitcoin mining (or mining any other leading PoW cryptoasset) requires a rather expensive mining setup. You can’t just fire up an old computer and hope for the best. Additionally, electricity costs, cooling technology, miner downtime, and potential repair costs also need to be taken into consideration.
As a solo miner, you would have to make a substantial initial capital investment and incur ongoing costs that may or may not be covered by your mining revenues.
What’s more, only mining in the hope to win a block reward is very much a lottery. The reported instances of solo miners winning big are highly uncommon. If you set up a handful of ASICs miners at home, the chance of winning the 6.25 BTC remains slim while the costs of operating your mining setup can end up running quite high.
If you are looking to solo mine solely with the intention of making a lot of money, there are probably better ways to achieve that.
However, if you would like to play your part in securing the Bitcoin network and leave the slight chance open to win a reward, why not go for it?
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