How to choose the best mining pool for you!
The purpose of a bitcoin mining pool is for a group of miners to join together and form a pool. By combining resources from all clients in that pool, they increase the odds of discovering the solution to a given block. When a solution is found to the block, it rewards the newly issued coin to the pool owner. The pool owner then divides the coins between the miners based on their contribution.
• Pooled mining produces a constant 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 fees, if any) due to long polling provided by the pools. Solo mining wastes time due to only supporting getwork pull.
When looking for the right mining pool to join, your goal is to find a fair pool that you can trust to provide you with optimal payouts in exchange for your time and energy resources. Though, the pool you choose, statistically, will not increase or decrease your odds. Choosing the right pool can greatly increase your overall earnings.
10 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 Fee's
Most pool's charge a fee everytime a block is discovered. For the highest payout over time finding a reliable pool with the lowest fees is crucial. When making your decision, start with considering pools with no fee at all.
Efficiency/Uptime
Do the research before committing to a pool. Make sure they 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's important that a pool has an open line for support and feedback in case you encounter 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 determine which provides a better user experience.
Difficulty -
A pool with a higher difficulty means they either there are more miners in that pool or they are using high-end mining hardware. This shouldn't be a concern when picking the right pool, as the difficulty will adjust based on the shares your hardware submits.
Payout Threshold
Always check a pools payout threshold, If the pool has a high payment threshold, low-end mining hardware may not be feasible.
Pool Hashrate
Comparing a pools hashrate to the network hashrate is a good way to measure how often the pool will discover a block. Statistically, this will average out over time and should not affect your overall payout over time.
Payout/Reward Method
Proportional - In this method, rewards are determined based on a division of rounds, the round is measured by the time separating one block discovered by the pool to the next.
CPPSRB - Capped Pay Per Share including Recent Backpay.
DGM - Double Geometric Method. A combination of PPLNS and Geometric reward models that allows operators to absorb some of the variance risks. Operators receive a piece of the reward on short rounds and replace it on longer rounds to normalize payments.
ESMPPS - Equalized Shared Maximum Pay Per Share. Like SMPPS, but equalizes payments justly among all those who have contributed.
**POT **- Pay On Target. A high variance PPS method, that pays based on the difficulty of work delivered to pool instead of the difficulty of work completed by pool
**PPLNS **- Pay Per Last N Shares. Similar to proportional, but rather than paying by the number of shares in a round, it instead pays via the last N shares, disregarding the round difficulty and length.
**PPLNSG **- Pay Per Last N Groups (or shifts). Comparable to PPLNS, but shares are grouped into "shifts" which are paid in whole.
**PPS **- Pay Per Share. Each submitted share is worth set amount BTC. Since finding a block demands shares on average, a PPS method with 0% fee would be 12.5 BTC divided by . It is risky for pool operators, therefore the fee is highest.
**RSMPPS **- Recent Shared Maximum Pay Per Share. Like SMPPS, but system proposes to prioritize the most recent miners 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 round. Rewards are calculated proportionally to scores and not to shares.
**SMPPS **- Shared Maximum Pay Per Share, works the same as Pay Per Share, but is capped 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
You can find a detailed breakdown of each method and how they vary here "https://bitcoil.co.il/pool_analysis.pdf"
It's impossible to find a pool that meets every expectation perfectly, 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 pool fee's, a great support team, a server near you, flawless uptime and backup server, a great reputation, and a provides a friendly user experience. For additional information to help you choose the right bitcoin mining pool we've written these articles to help you out: "Top 10 mining pools reviewed"
