Does Bitcoin Mining Need Better Decentralization for Small Miners

[Tunko]

I would like to start a discussion about the future of small Bitcoin miners and mining decentralization.

Today, Bitcoin mining is increasingly dominated by large mining farms, industrial operations, and investors with massive budgets. Small miners and hobby miners are becoming less common every year.

Large operations can:

- Buy thousands of ASIC miners
- Access cheaper electricity
- Operate industrial-scale mining farms
- Control very large amounts of hash power

Meanwhile, small miners using devices like Bitaxe, a few ASICs, or home mining setups face extremely difficult conditions.

I understand that Bitcoin mining is based on competition and economics. However, I also wonder whether excessive concentration of mining power could weaken decentralization over time.

Some questions I think are worth discussing:

- How can small miners remain part of the Bitcoin ecosystem in the future?
- Could mining become too centralized around large corporations?
- Would encouraging small-scale mining strengthen decentralization?
- Are there technical or community-based ideas that could help smaller miners participate?

I am not asking for free rewards or artificial advantages.

I simply believe that keeping participation open to ordinary people is important for the long-term spirit of Bitcoin.

What do you think?

[philipma1957]

The ship has sailed for miners not willing to use a host.

most of the world has power over ten cents a kwatt.

you can not mine with ten cent power and make money.

you can mine a tiny miner with low power and point to a solo pool thats about it.

my self i mine corexhosting.io

i use 10 units.

 9 s21xps
1 L9

this is about a 42,000 usd investment

and power is around 2400 a month

most people will not do this.

it is simple and easy to just buy 0.5btc instead.

[NotFuzzyWarm]

BTC is working exactly as it should. The idea of folks running a low cost home mining operation at a substantial profit is largely a myth. When I started back in early 2014 a s1 doing just a couple hundred GHS cost over $1.25k, a 1THS miner like the DragonMiner cost nearly $10k.

I was lucky enough to have around $8k of 'spare money' to spend on dipping my toes into mining and yes I did very well but ONLY because:
A. I could afford decent high end ASIC's
B. I could afford the electric bills. Back then electric for me at home was about 1/2 of what it's price is now.
C. I poured most of my earnings into constant upgrading and expansion until I hit my power limit of 15kw at home. After that it was facilitated by me having a 'free' 35kw available at the company I co-founded back in 1980.

Thing is, other folks caught onto mining and after a couple years it became more of a declining income for me because of the folks with more power getting the lion share of pool rewards. That applies even more these days.

[Tunko]

I understand the economic reality of mining, and I agree that large-scale operations currently dominate because of cheaper electricity and massive investments.

But I still believe small miners matter for Bitcoin.

Even if a home miner with a Bitaxe or a few ASICs has a very small chance of finding a block, their existence helps decentralization. If mining becomes something only giant companies can afford, Bitcoin slowly becomes more centralized over time.

Not everyone mines only for profit. Some people mine because they believe in:

- Supporting the network
- Learning the technology
- Running independent nodes and miners
- Keeping Bitcoin open to ordinary people

Small miners may never compete with industrial farms in raw hashpower, but they still represent an important part of Bitcoin’s original philosophy.

I think the ecosystem should at least encourage and preserve participation from smaller miners instead of making mining accessible only to the biggest players.

[philipma1957]

I understand the economic reality of mining, and I agree that large-scale operations currently dominate because of cheaper electricity and massive investments.

But I still believe small miners matter for Bitcoin.

Even if a home miner with a Bitaxe or a few ASICs has a very small chance of finding a block, their existence helps decentralization. If mining becomes something only giant companies can afford, Bitcoin slowly becomes more centralized over time.

Not everyone mines only for profit. Some people mine because they believe in:

- Supporting the network
- Learning the technology
- Running independent nodes and miners
- Keeping Bitcoin open to ordinary people

Small miners may never compete with industrial farms in raw hashpower, but they still represent an important part of Bitcoin’s original philosophy.

I think the ecosystem should at least encourage and preserve participation from smaller miners instead of making mining accessible only to the biggest players.

with 42,000 in gear and a 2400 power bill i have 2430th in sha 256 and 17gh in scrypt

all pointed at viabtc.com

i am a small miner

so i also have the equal to 2430 bitaxe miners.


i do not knock those 2430 bitaxe miners.

in fact i actually have a bitaxe miner set to 800 gh.

just because i want to have the illusion or delusion that it will hit a block.

my hosted gear would take about 9-10 years to hit a block

my bitaxe would take about 24,000 years to hit a block .


in order to have real importance you need to have 20,000,000 bitaxes mining. they would hit a about 3 blocks a day

let me see.

20,000,000x0.00000047=9.4 btc or around three blocks a day

so if the tiny gear world wide is 20,000,000 th or 20,000 ph or 2eh

they grab 3 blocks a day.

there are a lot of 15-20watt a th pieces of gear mining

so are there 2eh world wide maybe i do not know.

[Tunko]

I understand the economic reality of mining, and I agree that large-scale operations currently dominate because of cheaper electricity and massive investments.

But I still believe small miners matter for Bitcoin.

Even if a home miner with a Bitaxe or a few ASICs has a very small chance of finding a block, their existence helps decentralization. If mining becomes something only giant companies can afford, Bitcoin slowly becomes more centralized over time.

Not everyone mines only for profit. Some people mine because they believe in:

- Supporting the network
- Learning the technology
- Running independent nodes and miners
- Keeping Bitcoin open to ordinary people

Small miners may never compete with industrial farms in raw hashpower, but they still represent an important part of Bitcoin’s original philosophy.

I think the ecosystem should at least encourage and preserve participation from smaller miners instead of making mining accessible only to the biggest players.

with 42,000 in gear and a 2400 power bill i have 2430th in sha 256 and 17gh in scrypt

all pointed at viabtc.com

i am a small miner

so i also have the equal to 2430 bitaxe miners.


i do not knock those 2430 bitaxe miners.

in fact i actually have a bitaxe miner set to 800 gh.

just because i want to have the illusion or delusion that it will hit a block.

my hosted gear would take about 9-10 years to hit a block

my bitaxe would take about 24,000 years to hit a block .


in order to have real importance you need to have 20,000,000 bitaxes mining. they would hit a about 3 blocks a day

let me see.

20,000,000x0.00000047=9.4 btc or around three blocks a day

so if the tiny gear world wide is 20,000,000 th or 20,000 ph or 2eh

they grab 3 blocks a day.

there are a lot of 15-20watt a th pieces of gear mining

so are there 2eh world wide maybe i do not know.

I understand your point, and I agree that statistically a Bitaxe has an extremely small chance compared to industrial farms.

But I think the value of small miners is not only measured by expected block rewards.

Even if a home miner never finds a block, it still contributes to:

- Geographic decentralization
- More independent participants
- Education and experimentation
- Keeping Bitcoin accessible to ordinary people

If mining becomes something only massive companies can realistically participate in, Bitcoin risks becoming increasingly centralized over time.

Of course economics matter, and large operations will always dominate in raw hashpower. But preserving the ability for individuals to mine — even on a very small scale — still has philosophical and network value in my opinion.

I also think many small miners are aware of the odds. They mine because they enjoy participating in the network, learning the technology, and supporting decentralization, not only because they expect profit.

[FP91G]

If mining becomes something only massive companies can realistically participate in, Bitcoin risks becoming increasingly centralized over time.

Of course economics matter, and large operations will always dominate in raw hashpower. But preserving the ability for individuals to mine — even on a very small scale — still has philosophical and network value in my opinion.

I also think many small miners are aware of the odds. They mine because they enjoy participating in the network, learning the technology, and supporting decentralization, not only because they expect profit.

Bitcoin is already becoming more centralized because all the pools are known and they mine 99% of the blocks.
https://bitref.com/pools/
If these pools reach an agreement among themselves or a regulator forces them not to process certain transactions, this will be the beginning of centralization in Bitcoin.

[NotFuzzyWarm]

Even if a home miner with a Bitaxe or a few ASICs <snip>

Just to be clear, the Bitaxe is an ASIC. The difference between them and full scale miners is that they use just a couple/few recycled Bitmain ASIC chips vs the several hundred found in the industrial miners the chips came from. The only home 'miner' that does not use ASIC chips is the Nerdminer V1 & V2 toys which are horribly underpowered CPU miners that respectively give a ridiculously low 72kHS and 1MHS.

Gekkoscience.com sells several home miners as well that have far better build quality than most of the Bitaxes.

[philipma1957]

I am mining a modded t21 at a solo pool. which I will stop doing on may 31 as it is too costly.  this is in my home and is 1600 watts an hour or 1,156,400 watts in a month ie 1158 k-watts  or .20x1158=

231.6 usd per month I simply can't do this long term. I did do it to help out the new mineshop.eu solo pool.

I will stop mining there in 2 weeks

those 80th or 80 bitaxes do not do much for mining be not centralized.