Why does everyone think Solo Mining is a waste of time?

[sdp]

There comes a time when you wont get anymore than penies but you wont get paid because the minimal amount you need to get a payout is 0.1 BTC ($10 USD)  Are there any pools that have a lower limit like 0.01 USD ?   There comes a time when if your hash is too low, you are better off solo mining.  At least you have a chance.

 

[os2sam]

There comes a time when you wont get anymore than penies but you wont get paid because the minimal amount you need to get a payout is 0.1 BTC ($10 USD)  Are there any pools that have a lower limit like 0.01 USD ?

I'm surprised the p2pool fanatic's haven't chimed in on this one.

P2pool will payout your portion every time a block is found regardless of how small your share is.

Read up on "bag of pennies" wallet and the ramifications of that for you.
Sam

[blazin8s]

Are there any pools that have a lower limit like 0.01 USD ?

deepbit and slush let you withdrawal 0.01  

there's probably some others

[Trongersoll]

I use Slush's Pool. One of the things it reports is how many blocks you have found. I've found none. I'm running about 100 Mhs. If i wasn't in a pool, i wouldn't have nuttin', and probably wouldn't live long enough to get anything. I'm old. So yeah, with a pool i at least got something other than just Electric bills.

[seannnyx]

Pooled mining = steady job
Solo mining = playing the lottery for jackpots of 1000 dollars

See the difference now?

hahaha good example XD

[jamesblack]

because you may not find anything for a long time ....

[Welsh]

It's not a 'waste' of time, if you have a really good computer, or if you have very good luck.


But, because of the difficulty to mine, even in pools as shot through the roof, it does make it harder.

Solo mining is like playing the lottery, if you win you win big.

[DeathAndTaxes]

There comes a time when you wont get anymore than penies but you wont get paid because the minimal amount you need to get a payout is 0.1 BTC ($10 USD)  Are there any pools that have a lower limit like 0.01 USD ?

I'm surprised the p2pool fanatic's haven't chimed in on this one.

P2pool will payout your portion every time a block is found regardless of how small your share is.

Read up on "bag of pennies" wallet and the ramifications of that for you.
Sam

Not exactly true.  The p2pool doesn't have infinite resources so the share chain only records so many shares.  If your hashing power is very low then there is a high probability you won't have any shares in the share chain at the time a block is found.

[DeathAndTaxes]

Would you prefer a constant pay packet every week or the possibility of getting a years pay one day throughout the year.

Every week? If you are comparing mining to a normal job's salary then I'd actually prefer a years pay immediately. Throughout the year money loses value due to monetary inflation and goods' price inflation. Not to mention the opportunity cost of receiving the money at a later time when they could be invested into something immediately and some of the profits on that investment would be to pay off the living costs and the rest would be reinvested.

Well that wasn't an option.  Maybe an example helps. 

Your employer is willing to hire you under either one of these options:
$100K annually paid $1,923.08 a week
OR
a 1% chance each week of getting $208,000 (EV = $104K annually a 4% bonus over the salary option)

This is your only source of income which would you pick? 
On average, taking the lottery option you will get one paycheck a year but you could get more than one or none in any particularly year.

[ilostcoins]

The expected return on solo is the same or very close to that with pool mining, depending on the pool you choose. So, it means bitcoin solo mining carries a MUCH higher risk (unless your hash rate is very very high) but pretty much the same expected return.

It's no wonder why most people don't do it. In normal investment, if an asset carries more risk, people require a risk premium in the expected returns.

[os2sam]

There comes a time when you wont get anymore than penies but you wont get paid because the minimal amount you need to get a payout is 0.1 BTC ($10 USD)  Are there any pools that have a lower limit like 0.01 USD ?

I'm surprised the p2pool fanatic's haven't chimed in on this one.

P2pool will payout your portion every time a block is found regardless of how small your share is.

Read up on "bag of pennies" wallet and the ramifications of that for you.
Sam

Not exactly true.  The p2pool doesn't have infinite resources so the share chain only records so many shares.  If your hashing power is very low then there is a high probability you won't have any shares in the share chain at the time a block is found.

D&T,
Thank for the info.

This is a little troubling since what is "very low" hash rate is in state of flux at the moment and soon "very low" could be measured in Ghs.

[gyverlb]

This is a little troubling since what is "very low" hash rate is in state of flux at the moment and soon "very low" could be measured in Ghs.

I'd say that if your share rate is measured by a single digit Ghs, where you mine may not matter much in the coming months :-)

[Astrophysical]

Would you prefer a constant pay packet every week or the possibility of getting a years pay one day throughout the year.

Every week? If you are comparing mining to a normal job's salary then I'd actually prefer a years pay immediately. Throughout the year money loses value due to monetary inflation and goods' price inflation. Not to mention the opportunity cost of receiving the money at a later time when they could be invested into something immediately and some of the profits on that investment would be to pay off the living costs and the rest would be reinvested.

The years pay would be on a randomly allocated day to uphold the analogy You don't get to choose when you receive it. It could be the last day of the year

exactly

[jerethdaminer]

It's simply a matter of math. Unless you have an absurd amount of computing power (way more than a few GPU's) you're just never going to find a block in a reasonable amount of time, even if the difficulty were to never change. But it is changing, and going up rapidly. It's entirely possible you would never find a block at all by solo mining when you factor in the difficulty increases. On the other hand, with a pool you're pretty much guaranteed to get something for even a modest amount of effort.

I'm pool mining with a mere 500 MH/sec and I'm getting about 0.18 BTC per week. That's not much, granted, and a lot of people will tell me how I'm wasting my time because I should just buy BTC, but I'm not mining for quick profits. I'm doing so because I like the idea of mining, I wanted to learn more about it, and I thought that it was a better way of acquiring BTC than dealing with the exchanges. I'll probably hold onto my meager earnings long-term and see where this whole Bitcoin thing goes. And I'll probably switch my GPU's to some alternate cryptocurrency when and if my BFL order ever arrives.

my thoughts exactly and more or less what i was just going to post.

[ewitte]

Are there any pools that have a lower limit like 0.01 USD ?

deepbit and slush let you withdrawal 0.01  

there's probably some others

I typically set my payout every 5-7 days even if I only had a single 200MH/s card the payout would be higher than that.  Usually I can get 0.5BTC in 4-7 days with current hardware. 2x7950, 2x7870

[Hippie Tech]

WARNING !! Solo mining does not constitue gambling. It is the epitime of the crypto currency movement.

In fact, when you join a pool, you are helping to centralize the hashpower of a decentralized currency. Wrap your brain around that one. ahah..

This problem can be avoided, for the most part, if pools were limited to 5% of the total network hashpower. Asic hoarders aren't helping matters much either.

[edgar]

so an owner of an avalon asic could actually do ok (for now) by solo mining?

maybe this explains why they are still being tested...

[ewitte]

I understand ASIC premium but I'm seeing a lot of older FPGA for sale costing near double for the hashing power in video cards lol.

[DeathAndTaxes]

This is a little troubling since what is "very low" hash rate is in state of flux at the moment and soon "very low" could be measured in Ghs.

Well low is relative to p2pool total hashing power.  IIRC (been a while since I did any mining) p2pool "share chain" is ~5000 shares long and with dynamic difficulty that means you would want to have at least 1/5000th of total hashing power of the pool.  That would still be a little low because due to volatility 50% of the time you would have no shares in the chain when a block was found (sometimes you would have 2+ but that doesn't reduce volatility).  With more like 1/1000th of pool hashing power most of the time (~90% of blocks) you will have at least one share in the chain.  If p2pool reached 1 terrahash then like MH/s scale miners wouldn't be very viable.  10TH/s would probably kill off most GPU miners too.

Note if p2pool uses a longer or shorter share chain now you should adjust those numbers.

[Hippie Tech]

I like the Ying Yang approach. heh..

You either will or won't find a block. Regardless of the odds, difficulty ect. Its 50/50.

All you have to do is try.