Solo Cryptocurrency Mining: How The Rewards & Profitability Works
Crypto mining pools are one of the most common ways to mine cryptos and make a profit while doing it. Still, mining coins solo is an option as well, if the miner has enough hashing power, and the necessary know-how to do it.
The crypto hype continues to rise, and digital coins are becoming more and more popular. Because of that, a lot of people are becoming interested in how to get to them outside of the exchanges, which is when they are discovering the possibility of crypto mining.
However, the problem is that mining is becoming more and more difficult, due to a large increase in the number of miners. At the beginning of a crypto era, mining solo was nothing unusual. However, today, stand-alone mining equipment can hardly find any block capable of handling on its own.
There are various ASIC devices and GPUs that are created for the purpose of mining. However, mining can get expensive, and buying the mining rigs is not that cheap either. Because of that, the miners have decided to join forces and create various mining pools, in order for the process to actually pay off. By working together, these teams receive a collective reward when they find a valid block solution, and the rewards they receive from the block is easily divided in accordance with the amount of effort from each of the participants.
Naturally, these mining teams are incredibly successful when compared to solo mining, which has caused many to believe that joining one of these pools is their only option. Of course, this is false, and solo mining is still a perfectly valid alternative. However, it will require a lot of hashrate, as well as some technical knowledge for you to start mining coins on your own.
What Is There To Know About Solo Mining?
Before you start mining cryptos by yourself, there are a few things that you should be aware of, first. The first one is that solo mining requires a lot, and we do mean A LOT, of mining power. And not only mining power, but also computer resources. Another thing to keep in mind is that rewards may not be the same as your real-life income, and there are many things that are influencing just how much will you be able to earn.
If you decide to try and mine an unpopular coin, you are basically taking a gamble that can go either way. A fair amount of research before you actually get involved in the process should be able to help with making a decision. Still, remember that, even with research, pretty much anything goes when you start mining an unpopular coin. Finally, renting computing power can allow you to mine cryptos even without proper rigs, so keep that in mind as well.
The truth is, nobody can answer whether solo mining is a good idea or not, since everyone's situation is different. Solo mining can be incredibly rewarding if you manage to find a block, and you won't have to share the reward with anyone. However, finding a block on your own can be beyond challenging, which is the downside of the situation.
How To Mine Solo
If you have made a choice to go through with solo mining, you should probably know how it can be done. There are basically two ways to do it. The first one is to use the existing solo mining pool, or to create your own crypto node and connect your mining equipment to it. Of course, the second option is much more complex and difficult to pull off, and it would be best to leave that to the more experienced miners.
Most users that have yet to earn that amount of experience would do well for themselves if they simply used one of the solo mining pools. However, they do charge a fee that you have to pay for using them, and the fee usually goes from 1-1.5%. However, in addition to using the pool, you will receive useful statistics that can help with analyzing the situation and your success.
Things to remember when it comes to solo mining is that it only makes sense to do it if you have enough mining power at your disposal. Also, it is never a good idea to exaggerate your equipment's capabilities, since you'll just end up wasting your time if you have unrealistic expectations. Remember – the competition is strong.
Solo Mining Computer Capabilities
Anyone can start solo mining at any time, since every graphics card out there is capable of locating a block. However, the true test includes the amount of time that it will need in order to do it. This is a very unpredictable aspect of the process, and it can vary a lot. It all revolves around the theory of probability, which makes it similar in some way to winning the lottery. Basically, you can do a lot to improve your odds, but there is no controlling luck.
Do not believe the stories that each graphics card that you connect to the same rig will allow you to coordinate their actions. This is a common misconception, and it is entirely false. The truth is that each graphics card operates on its own, and that sharing the work in this situation cannot be done.
Another thing to consider are various mining strategies, and it all begins with choosing a coin. Some miners choose to go for well-established cryptos like Ethereum, Zcash, Bitcoin, and alike. They won't find a lot of blocks, and usually, they can consider themselves lucky if they manage to find one or two per day. Still, they have a piece of mind since they know that the crypto is solid, and that the chance of finding a block to mine exists.
There are also miners that are willing to risk it and experiment with less popular coins. Mining those is easier, without a doubt, and it is even possible to make good money out of it. However, this approach will require you to become a trader, as well as a miner.
Is It Profitable To Mine Without Mining Rigs?
The answer to this is that it can be, under the right conditions. There are a lot of mining pools that are compatible with various platforms that are renting the mining power. If you wish to mine cryptos without having to buy a rig, you can simply buy a certain amount of mining pool, and then invest it into one of these pools.
With a little luck, or the right strategy and calculation, you might start mining in just the right time to find the block that will make your initial investment pay off – possibly several times.
Still, there is no guarantee that this will actually happen, and the luck is a very large part of the process. There are no simple wins and tricks here, and you will need to do a lot of research, as well as some funds for the initial investment, whether it is for buying the mining rig or for buying the necessary computing power. What's important to remember is that solo mining is definitely an option, just think good and hard whether you believe that it is worth trying.