Solo Miners Winning More Blocks, Sparking Decentralization Debate

Solo Bitcoin miners have recently been winning more blocks, a trend that has sparked curiosity and debate within the cryptocurrency community. In the past few months, several solo miners have successfully processed blocks, earning significant rewards. For instance, one miner recently bagged a 3.125 BTC reward, which at the time was worth approximately $259,637, including transaction fees. This success has raised questions about whether solo mining is becoming more common and whether individual miners with limited resources can compete with large, publicly traded mining operations.

Solo miners, which include both individual hobbyists and private groups, have seen an increase in their success rates. In 2022, solo miners using the Solo CKPool solved seven blocks. This number jumped to 12 blocks in 2023 and further increased to 16 blocks in 2024. However, it is important to note that mining without the support of a large pool is still akin to playing the lottery, as stated by Scott Norris, CEO of independent Bitcoin miner Optiminer. The mining pool industry is dominated by a few major players, and miners typically join these pools to share resources and split rewards. With services like Solo CKPool, miners can keep nearly all the reward once they find a block, but this does not necessarily mean they are mining with very little hash rate.

As the Bitcoin network has grown, more power and resources are required to mine blocks, leading to the emergence of industrial mining operations run by public companies. Some Bitcoin enthusiasts argue that this centralization is detrimental to the decentralized nature of Bitcoin. Hobby mining rigs, such as Bitaxe and FutureBit Apollo, have become popular among "Bitcoin maximalists." In January, a FutureBit Apollo processed a block, but this was only possible due to a nonprofit group donating hash rate to the machine from other sources. The goal of this initiative was to make Bitcoin and freedom technology accessible to anyone by dismantling the proprietary mining empire.

Despite the slim odds, the rise of hobby miners could be contributing to the recent increase in individual block wins. Econoalchemist, a pseudonymous Bitcoin miner, noted the growing trend of solo successes, stating that more frequently, a single machine processing a block is a small mining device found in someone's home. Optiminer's Scott Norris suggested that conglomerates could be processing blocks without using a big pool by having a lot of hashrate. Solo Satoshi, a company based in Houston, Texas, which sells mining equipment like the Bitaxe Gamma, estimates that using a $180 Bitaxe machine with a hashrate of 1.2 terahash per second would have a 0.00068390% chance per day of mining a block.

However, the primary goal of solo mining is not necessarily the financial reward but rather the promotion of decentralization. Matt Howard, the founder of Solo Satoshi, emphasized that the main objective is to achieve more decentralization in mining, with the Bitcoin reward being a bonus. To Bitcoin maximalists, decentralized mining is crucial for the integrity and security of the Bitcoin network. This trend highlights the ongoing efforts within the cryptocurrency community to maintain the decentralized ethos of Bitcoin, even as the network continues to evolve and grow.