Topic: newbie question about solo mining (Read 3309 times)

Measuring your expected winnings, in an ideal world you would have the same chance solo mining as in a pool (neglecting pool fees).  If you are a small miner, however, your variance could be extreme and you might run out of money to pay for your mining hardware and electricity bills before winning a block. This can be modeled mathematically as the "gambler's ruin problem". It is also a psychological issue, with fear and greed applying, especially for those who over extend their resources.

In the real world, there are a few problems in addition to the above.  First, if you solo mine your node is likely to have limited bandwidth to the mining nodes.  You may be slow to learn of a new block and waste your resources mining uselessly on an older block.  It may cost a lot of money to purchase the necessary Internet bandwidth and computers, some of which will almost certainly have to be located in expensive rental space in strategically located data centers.  If you fail to do this when you find your block it may be orphaned and you will get nothing.  In addition, there is potentially a far worse problem.  Your software or networking configuration may be defective and your hardware may find an incorrect block which may get lost due to a local problem.  If you are a large miner finding blocks every few days you will notice that you have a problem.  But if you are a small miner you may go months burning money without ever knowing that you were screwing up.  The solution to both of these problems is to use a solo mining pool, such as solo.ckpool.org

Second, if you solo mine your variance will be large.  If you are spending $1000 a month on mining at present prices and difficulty and you are efficient you might be profitable, getting back more than $1000 on average each month.  But if a block is worth $10,000 on the average you may have to wait for ten months before a payoff.  In reality, it may take well more than a year.  If you run out of money before you score a block then you will be out of luck and broke, a ruined gambler.

Doing pool mining has its own risks.  There are various opportunities for the pool operators to cheat you.  In addition they can have computer and network performance problems and lose blocks due to orphans and there will be less for you to share.  In addition, you will be paying fees to them (or if not you should be wondering how you can possibly be getting bandwidth and processing for nothing).  If you don't mind the fees, then you can get a (more or less) steady stream of income from pool mining.

But wait, there's more.  It is possible for miners to cheat the pools they use by using block withholding attacks. They can run special software that sends normal shares to the pool so they get their cut, but they withhold winning shares that score a block.  If a dishonest miner is a small fraction of the pool hash rate the block withholder will lose only a small amount by this strategy.  The loss will come out of the pool if the miners share in the pool's profits or out of the pool itself it is Pay Per Share (PPS). In the PPS case, if many people do this the pool will end up bankrupt and some miners will be left holding the bag.

You might wonder why a miner might want to withhold winning blocks.  There can be perfectly good reasons for such a strategy, for example if one is renting out one's hashing hardware one will get paid regardless of successful blocks, but there will be an overall reduction of network hash rate from people following this strategy, which means there will be a net benefit for the owner of the hashing hardware which will retain its value longer due to slower increase of difficulty.  (I make no comment whether this cheating is moral or immoral or legal or illegal, just that it is possible.)

My personal belief is that pool mining is a poor investment because of the risk of block withholding, except when it is done by groups of people who enjoy mutual trust.  I am prepared to accept the variance of solo mining but have limited network bandwidth.  I am presently using a solo mining pool, after giving up on several conventional pools following extended periods of bad luck, for whatever reasons.  (I have also been luck and scored a block last summer in solo.ckpool.org in six weeks using two Antminer S3's.)

Now I'm interested in solo mining.  Switching my Antminer 3 to play the casino.  Saw 1 guy hit a block after 2months.

also try this one , i use eligius.st as my main pool if you want a instant payout then eligius.st is not the one you want and i use Slushes as my back up or investment pool as i call it .  at slushes you can set and take any payout you want . no limit other then there is a fee if it's below 0.01 btc it pays out every hour .

https://mining.bitcoin.cz  aka slushes   pool .


 here is a start up link for it etc  https://mining.bitcoin.cz/help/#!/get-started/mining_beginners



it is the very first BTC mining pool ever started, if the POP is telling us right, i trust him and believe him .

so am i newbie here, want to know more about mining and pool, any guarantee that site and command was safe ?
thanks before

 There have already been 2 new miners announced - Antminer S7, probably in September, and an lktec unit likely in December.
 This is NOT counting anything Bitfury, KnC, and "the company formerlly known as Spondoolies" are doing since they don't sell to the public any more.
 This is also not counting folks that haven't announced ANYTHING about what they might be working on for the next generation (like Avalon).


 Too expensive, the initial investement is VERY HIGH and only if you're in a very isolated area will it ever pay off at all.
 The technology needs to come down more in price before solar gets to be usefull, many companies have been working on that but even at COMMERCIAL scale solar is still a lot more expensive than any other widely used technology for power generation.

And up all lies luck.
Even if you mine with best asic on web then also there are very less chances that you hit a block.
And with reward halving in july,2016 i don't think that any new miner will come into mining.
Then i think people start using the solar energy, in my country(India) there is availability of around 10 to 11 hours of sunlight a day. But still in buying solar panels and batteries it will cost too much and with no assurity of return over investment.

Very good point...

But just to elaborate... I do not recommand using a CPU OR a graphics card to mine bitcoin!!!

A long time ago, people started to produce ASIC's . These are basically, small devices made for the sole purpose of hashing one specific kind of algorithm... These devices can deliver extremely high hashing speeds for extremely low power usage. They exist for sha-256 (bitcoin, namecoin,...) and scrypt (litecoin, doge,...).
You CAN NOT compete against these ASIC's with your CPU or your graphics card... Period...

The only way to actually have a chance in mining a block, is buying an ASIC... If you buy a small ASIC (like an antminer U3), chances are still almost not existent you hit a block... If you join a pool, payouts will still be low, but at least you'll have something to show for your efforts...

IF you buy an asic, i strongly suggest reading up on the technology, rewards and odds... There is a very big calculation you have to make, including power costs, risks, investments, ROI,...

Yes you can do cpu mining, but the hashing speed will be very less. There is a software called cpuminer and search on youtube on how to setup cpuminer and those videos can guide you better.

But for this should i have to buy a Graphics card to mine in bfgminer, cgminer or what ever software, the system which i am using dont have graphics card . I have tried to setup the cgminer software but it is searching gpu but i want to try with cpu.

 I just want to experiece what will happen if i setup cpu minning.

Mining solo means you are taking your chances and hoping to solve a block on your own.  The result is that you get the full block reward (currently 25BTC).  Either you hit, or you don't.  Mining in a pool means you, along with everyone else, are attempting to find the block solution.  If and when a block is indeed found, the 25BTC is distributed to the miners according to some known payout scheme (like PPS, PPLNS, etc).  In other words, you get lots of little payments.

The pool I described in my first post is run by -ck.  He, along with kano, are the guys who wrote the cgminer software.  This "solo pool" works just like any other pool, except that when a block is found, only the person who found the block gets the reward.  It's not about combined hashing power like in a traditional pool.  Basically, you're solo mining without needing to run your own full Bitcoin node.  The pool does that bit for you (and so far they've found 88 blocks).

 Don't even bother trying to MINE Bitcoin (or any SHA256 altcoin or any Scrypt altcoin or even any X11 based altcoin) with that setup.

 You will get VERY VERY TINY amount of coin mined, for a LOT MORE ELECTRIC COST spent. You'll lose money.

 That setup would probably never find a Bitcoin block if you ran it 'till it died - it's extremely unlikely if it would find a Bitcoin block before the last Bitcoin was mined even if the rig NEVER died.

No, it won't be sufficient to mine....
There is a very very very very very small chance you'll hit a block, but it's almost not existent...

If you do want to solo mine, i guess your best chance would be to use a solo mining pool like this one: https://solo.nicehash.com/
It will save you the hassle of running a node, setting up bfgminer, cpuminer,.... (you'll still have to setup this software, but usually the pool has an easy how-to made for you)

can you please explain me how are you going to do your solo mining, as i also wanted to try

I have a Core2duo 2gb ram 500gb hdd / intel motherboard with in built graphics, will be sufficient to mine and how can i do this

please help me with this detail.

Bitcoin difficulty has gotten so high it's really not practical at ALL to try to solo mine. Even with that S5+ (biggest single miner to date), your chance of finding a block is tiny - many many YEARS for a 50% chance to find ONE block even if difficulty stays FLAT that entire time (it won't).


 Might be different on some altcoins, though.

I see, Eligius might now be for you then because I don't think you can withdraw without the minimum balance which is something around 10mBTC.

I posted Eligius because you don't have to make an account which makes it simpler for you. But now you'll have to find a site and create an account.
Not much more complicated but it's an extra step.

Is there a reason you're using eligius, or just personal preference? I'm searching for the pool that gives me the most dust and has the lowest possible withdrawal fee (currently only mining with 2 Antminer U2's + 1 gridseed GC3355).
The reason i ask is because my hashrate is only around 10G, so when i use the wrong pool, it might take months before i can even withdraw my tiny earnings... I knew i would never ROI with these toys, but i wanted to learn about mining...

thanks for the info! will set this and start experiments!!

I strongly advise against solo mining.

You can set up your miner to Eligius (pool I recommend) the same way jonnybravo0311 described in his post.

Use
instead.

cjambox's reply is not very helpful not enough info

here is the deal.

there is about 375 ph mining as I type

or 375,000 th   since 1 ph is 1000 th


so if you are mining with 1th  for every block  your shot is1 out of 375,000  since 1 th is about 2 antminer s-3's or 1 antminer s-5  and you get a 1 out of 375,000 shot cj has told you it is hard you need a lot of gear.


ck's solo pool   does some work for you and charges a tiny fee.  you only need run a miner not a miner and a server.

if you run 1 th 24/7 your chance of a block is 144/375,000 each day.  thus people call it like a lotto.

since it is about 2600 to 1 in a day to hit  with 1 th

but if you mine 4th at f2pool  with its daily payout and 1 th at ck solo pool with its all or nothing block concept  you get the best of both worlds.

thanks for the reply cj

maybe this been analysed over and over but 
what i am trying to be enlightened about is
what is the difference in performance between solo vs pool using same power,
 when you do solo mining from what i understand is like playing lottery,
is there a system or way to do that effectively like the pools other than big power?? is it worth the hassle to go solo?