This guide covers the most common rewards systems of how a mining pool could distribute rewards to the miners.
- PPS (Pay per share): You get paid for each valid share you contribute to the mining pool
- FPPS (Full Pay per share) or PPS+: Like PPS, you get paid for each correct share, but on the top of the rewards, a miner gets the block fee too.
- PPLNS (Pay per last n shares): You get paid when a new block gets mined.
- SOLO: You mine independently
- PPLNT (Pay per last n timeshares): You get paid for your time slices instead of work slices
When you have the choice to choose PPS as a mining reward option on a mining pool, you get rewarded for every share you contribute to the mining pool. Only every valid share counts.
The share worth is calculated based on how much shares a mining pool needs to mine one block. For example, if a mining pool needs 100 shares to mine one block, and you get 10 valid shares, you get 10% of the rewards from the new block. If a block reward were 6.25 coins, you would get 0.625 coins. If the network difficult changes, the price of a share also changes because you need more or less mining power to mine a new block.
If you get paid with the PPS option, you will always get paid per share even if the mining pool doesn’t find a new block. The pool could lose money if they have a low luck phase or earn money if they have a high luck phase. However, the luck from a pool should statistically be 100%.
Theoretically, the mining pool could run out of money if they compete against competitors with massive hash power because they have to pay the users for every valid share.
FPPS (Full Pay per share) or PPS+(Pay per share plus) is similar to PPS. The only difference is that you get paid the transaction fees of a newly mined block.
If a block gets mined, a miner doesn’t only get the block reward. No, in addition to the block reward, he gets the transaction fees from all transactions in the block. For example, if you would have mined the 604814 BTC block, you would have got 12.5BTC (block reward) + 0.18518470 BTC (transaction fees).
PPLNS rewards miners only if a block gets found by the mining pool. That means you have to wait until a block gets mined to get your rewards for your shares. If a block gets mined, the pool looks at all valid shares that were contributed for this block and rewards the miners based on the valid shares they submitted. So, you don’t get payouts in the time frame when a pool doesn’t find a block.
This method is used by mining pools to prevent miners from hopping from pool to pool. Keep in mind that some pools don’t pay you with this method if you don’t have a steady connection to their pool, even if you submitted valid shares.
The PPLNT (Pay per last n timeshares) is similar to PPLNS, but it is based on time slices instead of work slices. Your amount of time spent mining in one round is compared with other miners to determine a period percentage. To qualify your proportional shares, you have to mine at least 51% of the period. For example, if a period is 1h, you have to mine at least 30.6 minutes. If your proportional shares are not qualified, your share count will be reduced. This method is used to reward loyal miners and to discourage pool hoppers.
What is SOLO mining?
Solo mining means you mine independently. If you find a new block, you gain all the rewards for yourself (after reducing pool fees). Unfortunately, if you don’t mine a new block, you don’t get new coins.
|Includes block fees||No||Yes||No|
|Luck factor required||No||No||Yes|
Comparison – Mining pools
Here are some mining pools and what payment methods they use.
|Antpool||PPS, FPPS, PPLNS, SOLO|
|ViaBTC||FPPS (Default), PPS, PPLNS|