What is Pool Mining?
In the context of mining a cryptocurrency, pool mining is when different miners combine their computing capacity to gain a greater chance of succeeding in completing blocks. Here, the reward is divided fairly among the different members depending on the work done.
One share is also offered to only one miner who has actively participated in solving the problem. Mining in a mining pool is a relatively new approach as it represents the evolution of cryptocurrency mining.
In particular, due to the increasing difficulty in mining, pool mining is gaining traction as a legitimate mining strategy among the various market participants. At the present time, it may take years for slow miners to complete a block, but by combining computing power, even a slow miner can contribute to successful completion and benefit from a constant yet small reward.
In particular, profitability should be taken into account, which is higher for pool mining. In particular, the constant distribution of premiums serves to amortize acquisition and maintenance costs.
How are the Scrap Tokens Shared Among Users?
There are different approaches to pool mining. The pay-per-share approach means an immediate and guaranteed payout after the successful completion of a block. Miners are rewarded by the pool’s existing income and can request a withdrawal immediately.
In addition, most risks are transferred to the owner of the pool. Another tactic is the proportional mining approach. Here, miners receive a reward after the completion of the block. However, this depends on their individual performance provided. Furthermore, the geometric, the double geometric and the pay-per-last N-shares methods are used.
Alexander Weipprecht is the managing partner of Provimedia GmbH. As a trained IT specialist for application development, he has been advising leading companies on the following topics for more than 10 years: online marketing, SEO and software. Cryptocurrency is becoming increasingly important to businesses and investors. Through Coin Report and Krypto Magazin Germany, Alexander wants to give all people easy access to the subject matter.