Solo mining is an individual miner. Although most of the current BTC mining power is concentrated in mining pools, there are still many people using their own computing power for solo mining... This article is based on a piece written by Liu Jiao Lian, organized, translated, and authored by Foresight. (Background: A small miner successfully mined 3.3 BTC with a 3.3 TH lottery miner, a miracle with a probability of less than 1 in 200 million?) (Supplementary context: Bitcoin miners independently mined 3.3 BTC! Since July, the 'lottery miner' has seen 4 miracles?) The probability of solo mining hitting a block is over 100 times higher than winning a lottery. Solo mining, as the name suggests, is individual mining. Although most of the current BTC mining power is concentrated in mining pools, where several large pools distribute rewards based on so-called power contribution, there are still many who choose to use their own computing power for solo mining. Compared to steadily receiving 'credits' from mining pools, solo mining is just a gamble of 'either hitting a block or wasting time'. For today's BTC block rewards, hitting a block means the solo miner exclusively enjoys 3.125 BTC, worth over 300,000 USD. However, the probability of hitting a block is indeed so low that hope seems bleak. How low is the probability of solo mining hitting a block? According to estimates of the total BTC network computing power, the current total computing power is about 900E (900EH/s). For simplicity, we take 900E. This number means that the entire BTC network can compute about 900E hashes per second. An astonishing figure. According to user Matt Cutler's estimates, if using a desktop miner with a computing power of 1T (1TH/s), then according to the independent and identically distributed hypothesis, the probability of hitting a block is 1T/900E = 1/900M, which is 1 in 900 million. How low is this probability? Based on the average of one block being mined every 10 minutes in the BTC network, it would take an average of 9 billion minutes, or 17,000 years, to hit a block once. For comparison, he listed the winning probabilities of two typical lottery products: Powerball Jackpot: 1/292M, or 1 in 292 million. Mega Millions: 1/303M, or 1 in 303 million. Clearly, on the surface, the probability of hitting a block is much lower than the winning probabilities of these two lotteries. But wait. We overlook time. The drawing frequency of the two lottery comparisons is 3 times a week and 2 times a week, far less than BTC's one drawing every 10 minutes. If we calculate the winning probability at 300 million to 1, then for 3 draws a week, it would take an average of 100 million weeks, or 1.92 million years, to win a jackpot. Clearly, it seems that solo mining still has a greater probability of winning than buying a lottery ticket. Let's consider time and align them: Weekly: Powerball (3 draws), winning probability: 1/97M, or 1 in 97 million. Mega Millions (2 draws), winning probability: 1/151M, or 1 in 151 million. Solo mining (1T computing power) (1,008 draws), winning probability: 1/892K, or 1 in 892 thousand. Monthly: Powerball (12 draws), winning probability: 1/22M, or 1 in 22 million. Mega Millions (2 draws), winning probability: 1/35M, or 1 in 35 million. Solo mining (1T computing power) (4,320 draws), winning probability: 1/208K, or 1 in 208 thousand. Yearly: Powerball (156 draws), winning probability: 1/1.87M, or 1 in 1.87 million. Mega Millions (104 draws), winning probability: 1/2.9M, or 1 in 2.9 million. Solo mining (1T computing power) (over 52,000 draws), winning probability: 1/17K, or 1 in 17 thousand. The probability of mining hitting a block is over 100 times higher than lottery winning probabilities. Of course, the probability calculation tells us that even with a probability over 100 times higher, for the vast majority of people, the contribution outweighs the earnings, the costs outweigh the rewards, in short — mining loses money. Because most people's lifespans are less than 100 years, which is nearly two percent of 17,000. This is precisely the cleverness of BTC's underlying design. Is there any investment (or speculation) in this world where the number of participants is particularly huge, where most people who invest money lose money, yet everyone enjoys it and cannot extricate themselves? Perhaps friends who like to tease would answer: wrong. The correct answer is: the lottery. BTC's PoW mining incentive mechanism is very similar to a lottery. Miners may not make money, but their tireless calculations contribute significantly to the world's largest 'public welfare project' — maintaining the BTC public ledger, voluntarily and actively making outstanding contributions. In a daze, there seems to be a spirit of public lottery within it. Since the birth of BTC 16 years ago, there have been annual doubts about how the BTC network will maintain itself in the future as rewards decrease due to halving. This reflects a dogmatic error of viewing problems with a static perspective rather than a developmental one. It is merely because at this stage, BTC is mostly provided by mining pools and mining companies for computing power that people question that these enterprises need profits and to make money; otherwise, they would not continue to mine or provide computing power. Perhaps this is precisely what the design intended! As miners and mining companies that mine for profits gradually withdraw due to reduced profits, solo miners and home miners who mine not for profit but for fun will gradually take their historical place. By that stage, BTC will have already entered a relatively mature phase. The current situation is merely a phase in which BTC is still growing rapidly (as reflected by the rapid increase in price). From a financial perspective, BTC is a non-interest-bearing, non-exploitative currency. The BTC chain does not allow for the fractional reserve system and credit expansion found in traditional financial systems. Therefore, based on financial theories understood since the last century, a financial institution that provides such currency deposits without allowing loans cannot only not pay interest to depositors but must charge them management fees; otherwise, it would be economically unsustainable. The BTC network is like such an institution that provides BTC deposits but cannot lend. A decentralized virtual machine operated by hundreds of thousands of miners distributed globally. Therefore, the electricity and other costs incurred by individual miners are essentially what economists refer to as management fees paid to this deposit institution. Unlike today’s miners whose motivation for mining comes from earning block rewards (which essentially dilute the value for all holders) and transaction fees (willingly paid by traders), future individual miners will be personal users or business users who hoard BTC and treat BTC as savings; their motivation to bear the costs of executing such a mining node is to ensure the safety of their deposits. Currently, the total computing power of a few large mining pools in the entire network is about 900E. If we assume it can be divided among 9 million users, then each user would need to provide an average of 100T of computing power. In the future, as computing efficiency improves, energy consumption decreases, and silent technology is further improved...

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