In the world of crypto mining, hashrate is a crucial factor that determines a miner’s ability to solve complex algorithmic problems, as well as the probability of finding the right answer and earning block rewards. In an industry dominated by mining pools, hashrate directly reflects a miner’s daily revenue.
In the mining community, it is generally believed that a higher hashrate equates to higher returns, but the reality is more complex. Recently, a SOLO miner with only 0.002% (about 6.7 PH/s) of Bitcoin’s total network hashrate won the right to update block 780,112, which earned the miner approximately $148,000 worth of BTC in block rewards and miner fees, according to Decrypt, a global crypto news platform. In the meanwhile, plenty of SOLO miners running 10 TH/s mining machines have worked for months with no returns.
This suggests that in crypto mining, having 0.002% or 0.02% of the network hashrate doesn’t make much of a difference, and luck plays a decisive role.
The good news is that as mining pools have risen to prominence, miners with low hashrates could also team up and capture a share of the spoils. By combining the hashing power of miners and mining farms worldwide, we can ramp up the success rate of finding the correct answer. With this approach, the block rewards generated are distributed based on the hashrate contributed by each miner. For miners, compared to SOLO mining, joining a mining pool can provide stabler returns.
Miners have reported significantly varying monthly returns offered by different pools even with the same hashrate. In today’s highly competitive mining pool industry, payment methods provided for miners have become increasingly sophisticated, and mainstream options include PPS, FPPS, PPS+, and PPLNS. For PPLNS miners, the daily revenue depends on the pool’s lucky value. To be more specific, the lucky value is positively correlated with the mining revenue.
Note: Lucky value, or block rate, refers to the ratio of actual block output to theoretical block output. For instance, if ViaBTC’s Litecoin pool offers a theoretical output of 100 LTC, the pool’s actual output will reach 103 LTC when the lucky value stands at 103%.
The lucky value of a pool depends on its technical capacity, and it is normal for the figure to fluctuate around 100% in the short term. However, if a mining pool consistently shows a lower lucky value than the industry level, it may indicate issues with the pool’s node deployment or underlying technology.
Having a high hashrate doesn’t guarantee higher profits. In SOLO mining, personal luck plays a big role, but if you are looking for mining pools, stable pools backed by a strong tech team are often good choices.
Choosing a mining pool entails thorough evaluation and comprehensive standards, yet the simplest method is to select the pool with the highest hashrate, as it indicates that the pool has earned recognition of the majority of miners and farm owners in the market. Such a pool could help miners minimize their risks.
This year, we will witness another LTC halving. Litecoin’s block reward is expected to decrease from 12.5 LTC to 6.25 LTC around August 3, which will break the supply-demand balance and lead to market fluctuations. Plus, through merged mining, which has become increasingly popular, LTC miners could also earn decent returns from the DOGE bonus. As a result, many miners have recently bought LTC mining machines and ventured into LTC mining.
In a word, when choosing a mining pool, miners should prioritize those with large hashrates, sound credibility, and good reputation. They should also remain vigilant and invest wisely, as mining investments come with risks.