Consider these 10 things when choosing a mining pool (Payout/Reward Method breakdown included)

The purpose of a Mining Pool is for many Cryptocurrency Miners to join their Computing Power (Hash Rate) together to record transactions to The Blockchain, and to earn more Cryptocurrency of course! By combining resources from all clients in a Mining Pool, they increase the odds of discovering the solution to a given Block of Transaction.

When a Miner Solves the Block, he/she receives Cryptocurrency as a Reward. But if he/she happens to be in a Mining Pool, the newly issued coin to the Pool Operator The Mining Pool Operator then divides the coins between the Pooled Miners based on their contribution.

• Pooled mining produces a consistent revenue of smaller values, whereas Solo Mining tends to be more erratic and could take years to mine one block.

• Pooled Mining can generate a 1-2% higher income (before Pool Fees, if any) due to long polling provided by the pools. Solo mining wastes time due to only supporting network pull.

When Choosing the Right Mining Pool to join, your goal is to find a fair pool that you can trust to give you optimal payouts in exchange for your time and energy resources.

Theoretically, your choice should not increase or decrease your odds. Choosing the Right Mining Pool can significantly improve your overall earnings.

Ten things to consider when choosing a pool

Reputation

Join a group and see what others are saying about any pool before joining it. You will get the best information from miners who have already tried the pool themselves.

Pool Fees

Most pools charge a mining fee every time someone discovers a new block. For the highest payout over time, finding a reliable pool with the lowest mining fees is the key. When making your decision, start with considering pools with no pool fee at all.

Efficiency/Uptime

Research before committing to a pool. Make sure the mining pool have an uptime of 99.5% or higher, check to see if the pool supports backup servers in the case an outage.

Support and Feedback

It is essential that a pool has an open line for support and feedback if you meet technical issues or notice any discrepancy in your payout.

Location/Latency

Choose a pool running on a server near you. If your computer takes to long to communicate with the pools server, you will lose precious shares. Shares received after a block change, intended for the previous block, are considered stale and not counted.

User Interface Panel

When choosing a pool, be sure to check their statistics page and API tools to decide which provides a better user experience.

Block Difficulty

A pool with a higher block difficulty means they either there are more miners in that pool or they are using high-end mining hardware. So, block difficulty shouldn’t be a concern when picking the right pool, as it will adjust based on the number of shares your devices submits, as well as your mining hash rate.

Payout Threshold

Always check a pools payout threshold, If the pool has a high payment threshold, CPU mining and even low-end GPU mining hardware may not be feasible.

Mining Pool Hash-rate

Comparing a pools combined hash-rate to the network hash-rate is an excellent way to measure how often the mining pool will discover a new block. Statistically, this will average out over time and should not affect your overall payout over time.

 

Payout/Reward Methods

Proportional –

This method determines Block Rewards based on divided rounds; each round measures the time between each new block the mining pool discovers.

CPPSRB –

Capped Pay Per Share including Recent Back pay.

DGM –

Double Geometric Method. A combination of PPLNS and Geometric mining rewards that allows Pool Operators to absorb some of the “variance risks.” Pool Operators receive a piece of the *Block Reward** on short rounds and replace it on longer rounds to normalize Miner Rewards.

ESMPPS –

Equalized Shared Maximum Pay Per Share. Like SMPPS, but equalizes Miner Rewards justly among all those who have contributed.

POT –

Pay On Target. A high variance PPS method that pays based on the Network Difficulty of work delivered to the mining pool instead of the Hash Rate Power for work completed by the pool

PPLNS –

Pay Per Last N Shares. Similar to proportional, but and not paying by the number of Shares Mined in a round, it instead pays via the last N shares, disregarding the Block Round Difficulty and duration of the round.

PPLNSG –

Pay Per Last N Groups (or shifts) are comparable to PPLNS. This method group shares and pays them out in whole after each shift.

PPS –

Pay Per Share. Each share mined is worth set amount BTC. Since finding a new blockdemands shares on average, a PPS method with 0% mining fee would be 12.5 BTC divided by the Miners Number of Shares. It is risky for Pool Operators. Therefore the Pool Fee is highest.

RSMPPS –

Recent Shared Maximum Pay Per Share. Like SMPPS, but system proposes to rank the newest Miners on the Network first.

Score –

Score based system: a proportional reward, but weighed by time submitted. Each Submitted Share is worth more over time since the start of the Block Round. Proprietary pool software calculates each reward proportionally to scores and not to Mined Shares.

SMPPS –

Shared Maximum Pay, Per Share, works the same as Pay Per Share. This method has a hard cap limit, to never pay more than the pool receives.

FPPS –

Full Pay Per Share. Similar to PPS,but not only divide regular Block Reward but includes some of the transaction fees. It Calculates a standard transaction fee based on a previous round and distributes it by hash power contributions. It increases the miners’ earnings by sharing some of the transaction fees.

It is impossible to find a Mining Pool that meets every expectation entirely, but as you see, there are many factors to consider while Choosing the Right Mining Pool for you. Ideally, the right pool should offer low/no mining pool fees, a great support team, a strong server near you, flawless up-time, an excellent reputation, and a provides a friendly user experience.

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