Pool mining vs solo mining: the variance trade

Picture a lottery drawing 100,000 tickets per round, where you can afford 10. Solo mining is buying your 10 tickets yourself: a 1-in-10,000 shot at the full jackpot each round. Pool mining is forming a group of 1,000 people who each buy 10 — the pool holds 10,000 tickets, wins roughly once every 10 rounds, and splits the prize proportionally. You get 1/1,000th of a jackpot, but you get it regularly.

Both earn the same per ticket. The difference is entirely in *when and how reliably* you get paid. Solo is feast-or-famine; pooled is salary.

Expected time to your next solo block = network block interval ÷ your hashrate share. It's worth internalizing how brutal small shares get:

"Expected" hides the spread: a 0.1% miner could easily wait three months for the first block, then get two in a week. Electricity bills and rent do not accept expected values. Unless you control a meaningful slice of the network (a few percent or more), pooling is simply the correct risk decision — you trade a 1–3% fee for a thousand-fold reduction in income variance.

• You're big — several percent of network hashrate; variance is already tolerable and you skip the pool fee.
• The coin is tiny — low difficulty, your hardware finds blocks in hours; solo saves fees where pooling adds little smoothing.
• You want the gamble — treating mining as a lottery ticket is a valid preference, so long as it's priced as one.

Project pages list each coin's pools with live hashrate — enough to see what fraction of the network a pool carries, and how lumpy solo life would be on that chain.