The Improbability of Solo Mining Success

On March 10, he managed to use a small, $299 setup and only 0.48 terahashes per second (TH/s) of hash power to solve a Bitcoin block.

In the competitive realm of cryptocurrency mining, where the quest for mining Bitcoin blocks is fierce and claimed more often by huge mining businesses, a single miner recently pulled off something nearly unthinkable.

On March 10, he managed to use a small, $299 setup and only 0.48 terahashes per second (TH/s) of hash power to solve a Bitcoin block. This earned him an incredible—and incredibly rare—reward: 3.15 BTC, which at the time was worth about $260,000. It looks like luck. Indeed, it is luck. But it’s also a tutorial for how and why Bitcoin mining can happen on a very small scale, even in a world where most of the mining is done by huge operations using vast amounts of electricity.

The chances of actually mining a Bitcoin block with such a low hash rate are almost nonexistent—approximately 1 in 1.6 billion, or once every 31,240 years, if you mine nonstop. Despite these crazy odds, this event reminds us that mining Bitcoin by yourself, if you ever actually could, is something you can still do, though only under very rare conditions.

It also shows how powerful mining pools have become and how almost hopeless the situation is for the individual miner in today’s Bitcoin network.

The Improbability of Solo Mining Success

An industry in which bitcoin miners compete to add blocks to the blockchain by solving cryptographic puzzles has emerged from the bitcoin network. The bitcoin network itself thrives on competition. Competitors are bitcoin miners, and their very act of mining, when concentrated, tends to create a series of powerful bitcoin mining farms. These farms need a lot of electricity to operate, and they tend to operate where electricity is cheap and where it is, in effect, a renewable resource—that is, where power plants can produce electricity that is clean (wind, solar, hydro) and constantly available (like efficient, clean natural-gas peaker plants, which fire up when demand surges). A bitcoin mining farm is kind of like an airplane hangar full of gigantic servers ready to crunch numbers and do useful work, in this case, solve the bitcoin puzzles.

To put it into perspective, a miner with 0.48 TH/s of hash power—like the one who struck gold on March 10—is operating at an extraordinarily low rate compared to the standard hash power used by professional mining farms. Large mining operations, which can operate with hundreds of petahashes per second (PH/s), are capable of mining Bitcoin blocks at an exponentially faster rate.

Mining a Bitcoin block becomes harder to do for the average person, yet takes no less than effort if one wishes to earn this crypto. So who has the hash?

The power of hashing has been left in the hands of computer-relying behemoths bursting at the seams with technology and human capital across the world. Your attempt to mine on, say, a laptop or even a powerful desktop in 2023 would end in negligible returns, if not total failure. Yet only a decade ago, enough computing power lived in human basements that some solos actually struck digital gold.

For instance, the chances of solo mining for success are so slim that you would have to mine continuously and nonstop for 31,240 years to even hope to strike a successful solo mining endeavor. This places a cap on the total amount of Bitcoin you could potentially earn through solo mining—unless, of course, you are a super miner with an inhuman capacity for the dedicated mining labor of half a generation.

The Impact of Mining Pools on Bitcoin Mining

When a lone miner discovers a block, it starkly illustrates how different solo mining is from pool mining. Mining pools—where individual miners combine their hash power and share equally in the rewards—are the preferred way of mining in today’s Bitcoin ecosystem. Mining layered on top of a mining pool dramatically increases your chances of receiving a steady stream of payouts. The rope of hash power that a pool hangs over the mining frontier for Bitcoin allows the pool to discover blocks on a much more regular basis than any single miner would. And a discovery by a solo miner reminds us that with all these discoveries, the Bitcoin blockchain is continuing to extend out into the unmined territories.

A typical mining pool consists of thousands of miners and their hardware, creating a combined hash power that can span several petahashes per second. These pools then divide the reward proportionally among all the contributors, based on their individual hash power. This setup has made it incredibly hard for solo miners to compete, unless they’re either outfitted with significant hardware or have access to substantial financial resources. Mining pools also allow for more predictable and stable earnings, which is why they’re so widely used by miners around the world.

Nevertheless, even with the clear advantages of mining pools, the story of a solo miner striking it rich on March 10 shows that all hope is not lost for solo miners. With