(update: 7/25/2021. Solo mining on the Circcash-qt wallet is not longer applicable since Circcash is now GPU minable.)
On March 4, 2021, the price of 1 CIRC according to the Bitsails exchange is about 1 cent. This means that the value of 1 block is 10 cents. From March 2,2021 to March 9,2021 the price of Circcash has decreased substantially. On March 2, 2021, the Circcash mining pool which currently creates 97.4 % of the last 1000 blocks (from 11:27 p.m. 3/4/2021) was not producing Circcash blocks for about 12 hours. As a consequence, there have been periods of time where no Circcash block was found for hours. When a blockchain temporarily goes offline or when blocks are produced very slowly, plenty of bad things can and do happen. As for the Circcash blockchain, a few bad things did happen, and it could have been much worse. When there is a mining blackout, the cryptocurrency is left wide open to 51 percent attacks and block reorganization attacks.
According to the Bitsails Exchange, the price of 1 CIRC has decreased from 21 Satoshis to about 10 Satoshis from March 1, 2020 to March 9, 2020. Of course, this is great for Circcash buyers since they can buy CIRCs for basically nothing (Circcash is currently valuable not because 1 CIRC is expensive but because it takes work and intelligence to understand Circcash at a level that convinces one to invest in Circcash.), and you cannot go wrong by investing in reversible computation in 2021, but the price of Circcash needs to recover since it is far too low. I hypothesize that the recent Circcash blackout has harmed the price of Circcash.
The purpose of mining pools is to reduce the variance in the amount of coins that one obtains from mining and to make sure that the miners are getting paid at a steady rate. In other words, mining pools are meant to provide the miners a sort of insurance so that they get paid for mining as long as they obtain a high hash rate regardless of whether they actually mine blocks or not. However, since the block reward for Circcash is currently valued at under 10 cents, there is no good reason for miners to join a mining pool in order to obtain this kind of insurance. If you are familiar with the Poisson distribution in probability, you can calculate the exact variance in the block reward that one receives by mining solo instead of in a mining pool, and this variance is not very high.
I am personally mining Circcash solo because I mine Circcash not just to obtain coins but to also protect the network. I also like mining Circcash solo because I like my independence, and I want as many variables under my control when I mine Circcash.
I plan on giving bounties to miners during mining blackouts in order to encourage entities to mine Circcash. In fact, during these mining blackouts, I plan on also submitting transactions with exceptionally high mining fees (such as a mining fee that is worth 100 CIRCs) in order to attract solo miners during the blackout and reward entities who mine Circcash solo during the blackout. Submitting a transaction with an exceptionally high mining fee allows me to automatically reward the Circcash miner without any need for any communication. Of course, I would also like for the miners to acknowledge that they know that solo mining has plenty of advantages over pooled mining, so there are advantages to giving bounties during mining blackouts as regular transactions.
Recommendations to the Circcash community to avoid network outages and similar problems in the near future:
- Mine Circcash solo as much as possible. As long as the block reward for mining Circcash is quite low, and as long as you expect to mine many Circcash blocks, joining a mining pool does not provide you much insurance, and it will not do much to reduce the variance in the amount of money that you will make from mining Circcash.
2. Set up a second mining pool to mine Circcash, and continue to use many mining pools. We do not want to be at the point where a single mining pool has a majority of the hash power. For this reason, Circcash miners should make and join multiple pools.
3. Periodically monitor your progress in mining Circcash. If you see that a mining pool has not been producing blocks lately, then that is a good time to switch to solo mining or a different mining pool until the mining pool resumes and starts producing blocks again.
4. Think more about the security of the network. Right now, Circcash is still relatively new, so there is a lot that could go wrong with Circcash. The job of cryptocurrency miners is to make sure that the network is secure. Furthermore, most Circcash users should want the value of Circcash to continue to increase, and the best way to increase the value of Circcash is to be aware of the possible security risks of Circcash and especially the risks of having a single mining pool with the majority of the hash power. Think about how your actions affect the price of Circcash.
5. Contribute towards making solo mining easier to use. The Circcash-qt miner is only useful for CPU mining, and hopefully Circcash miners will move towards GPU mining pretty soon. However, the Circcash miners need to have the option of mining Circcash solo without compromising on their hash rate. Circcash miners should not need to join a mining pool in order to obtain a high hash rate.
6. Whenever transacting in Circcash, verify that at least 1 block has been produced within the last 30 minutes and that several blocks have been produced in the last hour. If there is a Circcash mining blackout, then do not produce any Circcash transactions until the blackout is over.
7. Promote and buy Circcash. As the hash rate of Circcash increases and the network becomes stronger, there will be less risk of a Circcash mining blackout.
I have heard recent rumors that RPlant may remove the Circcash mining pool (and who knows if there will be a warning; RPlant did not directly message me about this). Right now only 1.3% of all blocks are mined outside the mining pool. This is very bad. It is absolutely terrible for Circcash to depend on a single mining pool in order to be secure. If the RPlant mining pool drops Circcash, then the difficulty of Circcash will decrease immensely and blocks will be processed very seldomly. This may result in Circcash being removed from the Bitsails exchange. Please mine solo. There is absolutely no reason to use a mining pool at all!
Now that Circcash has GPU-mining for AMD GPUs, once the Circcash difficulty increases following the hash rate increase, it is probably not worth it for anyone to mine with their CPUs on the Circcash-qt wallet. Of course, it would still be best for the Circcash miners to mine solo, but I don’t think there is any support for that.