  Mining is a central operation of all proof-of-work (PoW) based
cryptocurrencies. The vast majority of miners today participate in "mining
pools" instead of "solo mining" in order to lower risk and achieve a more
steady income. However, this rise of participation in mining pools negatively
affects the decentralization levels of most cryptocurrencies. In this work, we
look into mining pools from the point of view of a miner: We present an
analytical model and implement a computational tool that allows miners to
optimally distribute their computational power over multiple pools and PoW
cryptocurrencies (i.e. build a mining portfolio), taking into account their
risk aversion levels. Our tool allows miners to maximize their risk-adjusted
earnings by diversifying across multiple mining pools which enhances PoW
decentralization. Finally, we run an experiment in Bitcoin historical data and
demonstrate that a miner diversifying over multiple pools, as instructed by our
model/tool, receives a higher overall Sharpe ratio (i.e. average excess reward
over its standard deviation/volatility).
