A few years ago, it was possible to mine digital coins even on a home computer. With the growing popularity of virtual currencies, the requirements for mining have increased. For example, Bitcoin is mined only on asics, Ethereum – on video cards. In 2023, only owners of large farms can mine bitcoin solo. Experts have calculated: to make a profit from mining coins, you need to have from 0.05% of the total hash rate of the network. Therefore, users, as a rule, combine capacities to work together. In the article we will tell you what is a pool in mining. In the summer of 2022, the largest platforms (Foundry Digital, Antpool) own 37.69% of the global Bitcoin hashrate.
What is a mining pool
Buying powerful coin mining equipment alone does not guarantee monthly profits. Along with the popularity of digital currencies, the complexity of blockchains is increasing. In July 2022, this indicator for Bitcoin is 209.33 Eh/s, for Ethereum – 871.21 TH/s.
Due to the increase in the number of miners, competition is growing. Properly organized coin mining remains a profitable business even with the decrease in profits and the growth of operating costs (electricity, hosting rent). A mining pool is needed so that users can receive stable payments even with a small hash rate. The service divides the task between participants in proportion to the connected capacity.
Miners send their part of the solution (orb) to the pool and are entitled to a share of the reward.
Why are they created
The time to find a new block is a constant for every blockchain. In Bitcoin, it occurs every 10 minutes. The hash rate required to find a block is determined by the complexity of the network. This parameter is constantly growing in popular coins. Competition between miners also reduces the probability of a solution.
To increase the profitability of the business, the owners of computing equipment pool capacity. Pools distribute the reward for a block taking into account the share of participation. This way, users can receive stable payouts. According to Blockchain.com, in July 2022, miners earn $22.44 million per day.
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Principle of work
Servers divide tasks into simpler ones and distribute them among participants (F2Pool, AntPool). The organization of miners’ work is performed by the program. If necessary, a coordinator can intervene in the algorithm.
The process of collective mining looks like this:
- The pool receives a task.
- The algorithm divides it into smaller ones and sends it to miners.
- Users solve their parts of the task. The result (orbs) are sent to the system.
- The server checks if the solution is a valid hash.
- If the orb satisfies the requirements, the system commits to mining a new block.
- The server distributes rewards according to the approved method.
Reward allocation systems
Pools distribute payment for validating transactions and generating blocks to participants. The rewards for a valid hash include:
- Cryptocurrency created. Coins are distributed among the miners. From this money, the platforms retain interest for services.
- Transaction fees. Some pools (F2Pool) write them off in their favor completely.
Pay-Per-Share (PPS)
In 2023, most mining platforms pay miners for each accepted fragment of the solution (shara) regardless of block formation. The services assume additional risks (hash search may take longer), so they charge higher commissions.
The price of a balloon is not a constant value. The algorithm calculates it based on the complexity of the network, the power of the pool in mining, and the time of block formation. The Pay-Per-Share (PPS) method is used by such platforms:
Pay-Per-Last-N-Shares (PPLNS)
This is another popular method of distributing rewards. Unlike the PPS method, there is no fixed payment for the submitted solution. Participants receive cryptocurrency only after the platform finds a valid hash. The service pays for each ball accepted during the solution of the problem. At the same time, a reduction factor for beginners is applied.
The longer a participant works on the platform, the higher his income. This is how platforms reward loyal customers.
In the summer of 2022, Pay-Per-Last-N-Shares will be in operation:
- Antpool
- Ethermine
- Multipool
Multipool features
Most services are focused on mining a specific coin. To change the cryptocurrency, the participant must reconfigure the program. For beginners, this is difficult. Inexperienced miners are better to start working with multipools (NiceHash, ViaBTC). Such services have peculiarities:
- Automatic switching to the most profitable coin. There is no need to reconfigure the .bat file.
- To work, you need to download mining programs for all supported cryptocurrencies.
- The reward is paid only in BTC. Users can independently exchange coins for promising altcoins.
- High pool commissions in mining. NiceHash takes 2.5% of the income, ViaBTC – 4%.
- To withdraw money to the wallet, the user independently creates a transaction and pays the network commission.
Top 10 large mining pools
According to Mining Pool Stats, in the summer of 2022, it is possible to mine cryptocurrency on more than 600 platforms. Participants choose a project according to their needs. The main parameters are the available coins and the capacity of the site. Experienced miners recommend connecting to services from the top 3 for the selected cryptocurrency. The table shows the largest platforms for mining popular coins in July 2022.
Pièce de monnaie | Pools |
---|---|
F2Pool
The platform was founded in 2013 in China. F2pool also has servers in Europe, USA. In the summer of 2022, customers can mine 11 coins including:
Registration in the project is not required. To start mining, you just need to download the mining program and make changes to the .bat file. F2pool is suitable for experienced users with powerful equipment. The administration gives 90 days to withdraw the reward. The service writes off the unclaimed coins for the specified time in its favor.
The minimum amount to issue is 0.0005 BTC. Miners do not pay the network commission for withdrawing Bitcoin. These costs are borne by F2Pool.
BTC.com.
The large Chinese pool is owned by mining equipment manufacturer Bitmain. The platform gives participants a block reward and transaction fees. BTC.com only charges a service fee of 2.5%.
In the project it is profitable to work at the extremes of the market during a strong load on the blockchain. Taking into account the high network commissions, miners earn 10-20% more. Along with top coins, users can mine promising altcoins:
ViaBTC
This Chinese platform works stably in Russia thanks to low ping (68 μs). With strong signal delays, part of the balloon may not reach the server. The service’s technical support responds to users via email and chat 24 hours a day.
ViaBTC is a multipool, switching between assets is automatic.
Users can set up lists of mined koins. In the summer of 2022, 11 cryptocurrencies are available, including:
MinerGate
The service is equally convenient for beginners and experienced miners. MinerGate offers a large number of settings for comfortable work. The developers have placed instructions for working with the service on the tab with answers to common questions.
In MinerGate you can mine several cryptocurrencies simultaneously without degrading the speed of mining the main asset. The web interface is translated into 19 languages, including Russian.
In the summer of 2022, customers can mint the following koins:
- Bitcoin
- Ethereum
- Monero
- Bytecoin and others
Miners can automatically select the most profitable coin for the last 60 minutes (Smart Mining function). You don’t have to download the program to work in MinerGate. You can mine virtual currencies through a browser, but the mining performance is lower. MinerGate also offers a good referral program. Members can earn 70% of the platform’s profits.
Ethermine
One of the largest services for ETH mining concentrates 30.5% of the blockchain’s computing power. You can mine cryptocurrency in Ethermine without registration. Creating a personal account makes it easy to view statistics. At the same time, the system does not ask for personal data, so you can work completely anonymously. Ethermine servers are located in the United States, Europe, and Asia.
Auteur : Saifedean Ammous, expert en économie des crypto-monnaies.