PoW mining is critical to Bitcoin network security. Mining, in turn, is subject to 3 major sources of variance, from (roughly) easiest to tame to hardest:
i/ Finding blocks via SHA256 hashing
ii/ Market demand (for BTC & transactions)
iii/ Tech innovation
For small solo-miners, the variance in finding blocks (& consequently, the variance in payouts) is too great to make mining practical.
The larger your hash rate, the closer you’ll get to this ~10 min/block average, and the more stable your payout curve.
Currently, Stratum pools are popular. The downside of Stratum pools is that miners give up the right to propose blocks & harm decentralization. With BetterHash proposal, this will hopefully change.
In early-stage Bitcoin, block rewards subsidize network growth & hash rate is a direct function of price.
In late-stage Bitcoin, hash rate is a function of price AND transaction (tx) volume - which together make up the fees.
Vice versa, demand for BTC & transactions can also decrease.
Mining is inherently a high-risk business due to large CAPEX cost. Your hardware can go out of date before you can recoup the initial investment.
However, there are signs that Moore’s law is breaking down as we reach the limits of “miniaturization at atomic levels.”
a/ Practical limits of minimization.
b/ Beyond these limits are other limits: energy efficiency limits, computational speed limits.
Absence of a major tech breakthrough, when we run into these limits, ASICs will likely become commoditized. In which case this variance will resolve itself out.