As the price of cryptocurrencies like Bitcoin has dramatically increased over the years, interest in mining has naturally picked up. Mining can be profitable if you invest in the right tools and combine your computational resources with other cryptocurrency miners over the network.
That said, some Bitcoin miners prefer to go it alone using a home PC, even if the network has grown and the difficulty of mining has increased. Solo Bitcoin miners defy the odds to create valid blocks that add transaction records to the public ledger, i.e., the blockchain. Diving into a Bitcoin mining pool doesn’t require a fortune, yet it involves patience, some even comparing it to winning the lottery.
Can A Single Person Mine Bitcoin? Why, Yes!
If you have sufficient computing power and the price of electric power isn’t a problem for you, you can mine Bitcoins solo. Unlike miners in a pool who come together to devote their hash rate to mine Bitcoin, solo mining doesn’t depend on a third party. When Bitcoin mining first began, it was undertaken individually.
Satoshi Nakamoto mined the first Bitcoin block, referred to as Block 0 or Block 1. He used a CPU to do this, and this was the standard for the time. Bitcoin mining has shifted from general-purpose CPU to highly specialized ASIC miners, optimized to compute just a single function or set of related functions.
The odds of successfully mining a block solo are extremely rare. As a matter of fact, it’s happened only 270 times before in the last 13 years. On March 10, 2023, a solo Bitcoin miner managed to mine the 780,112th block in the Bitcoin blockchain, hitting the jackpot for $160,000.
The independent cryptocurrency miner solved a puzzle that would take months to decipher using limited processing power. He was lucky enough to have produced a valid hash following two days of mining.
The Bitcoin miner behind the rare event temporarily rented the hashing power to produce the output hash. Proof-of-Work miners must invest in processing equipment to secure the network, while Proof-of-Stake validators lock up set amounts of cryptocurrency.
Solo Bitcoin Mining Profitability Extensively Depends on The Hardware Hash Power
As a Bitcoin miner, you can work alone, but you’ll need the standard tools – mining hardware and a wallet to store your Bitcoins. Equally, you’ll need to run a full node, which can turn out to be energy-intensive. Most Bitcoin nodes use Bitcoin Core, the reference implementation of Bitcoin, but there are other high-quality alternatives to consider.
To ensure the Bitcoin node remains online at all times, dedicate a device exclusively to operating the Bitcoin node. If you complete the entire mining process on the Bitcoin network and find a block, you’ll reap the entire block reward. Many refer to this approach as lotto mining because it’s difficult, if not impossible, to mine a Bitcoin block with a small-scale setup.
Profitability in solo Bitcoin mining depends on the hardware power and network complexity. Cryptocurrency mining is a competitive scene, so you need a machine that’s capable of solving different hashing algorithms at a high speed.
The hash power designates the mining performance of the hardware. Given the growing popularity of Bitcoin mining and the constant rise in the network hash rate (the computational power of the Bitcoin blockchain), it’s difficult to solve a block on your own, but not impossible.
There have been stories of people who’ve gone at it alone, found new blocks, and won the entire reward. Nevertheless, the investment capital is substantial, so factor in cooling technology, downtime, electricity costs, and repair costs.
Buying Bitcoin Is Considerably Simpler and Safer Than Mining It
Solo Bitcoin mining is profitable, but it’s a bit of a gamble, as it depends on the probability of finding a block on the Bitcoin blockchain, which can depend on the difficulty and hash rate of the network. If you don’t have the necessary patience and capital investment, you’re better off joining a mining pool to increase your chances of winning.
Better yet, you should turn to buy Bitcoin. Not only is trading easier to set up, but it also costs less money. You can buy and sell cryptocurrency using just your smartphone. Even if you manage to overcome the challenges discussed above, the entire mining venture is risky, not to mention labor-intensive.
You can make a profit if Bitcoin’s price increases over time. Data sets indicate that Bitcoin’s value will increase once again in anticipation of the next halving, which is due to occur in April 2024. Past Bitcoin halvings have led to substantial appreciation in the price of the cryptocurrency, but there’s no guarantee the same will happen, so hope for the best.
One thing is for certain, namely that Bitcoin has managed to reach new highs with time, so it can maintain and increase your savings. You can instantly buy Bitcoin with a bank account or a credit card on a cryptocurrency exchange. Track the price of Bitcoin and keep an eye on the news as you embark on the path to financial freedom.
Concluding Thoughts
Instead of connecting to a Bitcoin mining pool, you can connect to your wallet, which provides the mining software with the necessary details in the shape of a candidate block to start hashing immediately. Running a full node is of the essence if you want to go it alone. As an investor, you’re better off buying Bitcoin than trying to mine it unless the price is expected to decline.
Keep in mind that it’s difficult to estimate the profitability of Bitcoin, meaning that calculations come with a margin of error. Hours of seemingly endless investigations will help you overcome the risks associated with volatility.
Bitcoin’s future and its role in the global economy remain uncertain (for now, at least). Take into account all the possible outcomes and find a realistic ground between the extremes. If Bitcoin can achieve mainstream adoption remains to be seen, yet there are some encouraging signs. For example, several traditional institutions have devised crypto strategies. Anyway, keep your fingers crossed.
