Bitcoin Mining Pools: Bitcoins are a virtual currency system, where there will be no third-parties or any other intermediaries in between. Bitcoin transaction happens just with a one-click, where the user logins and first acquires a bitcoin wallet, where the digital currencies will be stored. A digital wallet will be composed of a combination of private keys and a public key. Bitcoins can be sent and received using private keys and public keys. To know more visit here socialnomics.net
To verify and validate bitcoin transaction, bitcoin miners, uses a specialized computer system with high computing power, to perform the mining. Through mining, transactions will be validated and then added to the transaction chain. To perform mining, the miners will require mining hardware like ASIC and mining pools. To know more about bitcoin mining, the following sections will be helpful.
Bitcoin mining hardware
People interested in mining cannot use their home-based computers to take more time and consume more energy. With a home-based computer system, miners can only earn half a dollar in a year!! Hence to perform mining, high-speed computing hardware like ASIC is required. As bitcoin usage increased, the demand and competition for hardware also increased. In the region where there is an affordable electricity rate, you will see the ASIC industry. Thermally regulated data-centres can achieve these. Later it was found that using GPU’s the miners were able to acquire more hashing powers.
Bitcoin Mining pools
Bitcoin mining pools allow miners to mine in a co-operative fashion, where there will be frequent block rewards for all the miners, as the rewards will be shared among them. There are several mining pools like Poolin, F2pool, BTC.com, and lots more. Most of the mining pools are operating in China. Chine offers cheap electricity, and hence more mining pools are located in China. China stands first in bitcoin mining and then comes to Georgia and other countries.
Before a miner starts mining, he should have a bitcoin wallet and bitcoin mining software because mining pools will be asking a bitcoin wallet address to send the block rewards to that address. If wishing to switch to another pool, the Bitcoin miners can do by routing their hash power to that mining pool. The bitcoin mining pool’s size will be kept on changing.
Payment method for bitcoin mining pools
There are various payment methods through which the miner will be calculated the rewards based on their generated hash power. The payment methods are:
- Pay per Share
This is the easiest and simplest payment scheme, where the miners will be rewarded, whether the pool finds the next blocks or not. The amount is calculated based on the hashing power required to find the blocks. If a block requires 100 shares, then the reward would be 6.25 BTC. So, when the reward is divided by the share, each share will be worth 0.625. In this payment method, the mines will be charged with a transaction fee, and the payouts will also be smaller based on the block reward. The pool operator will take the
- Full Pay per share
This payment is also termed as Pay per share+, and it follows the same payment method as Pay per share. But the transaction fee will also be paid to the miner along with the block reward.
- Pay per Last N shares
This is the most complicated payment method, where the miner will be rewarded only if a block is found. The payout is calculated based on the time window concept. If a block is found, the number of blocks previously found will be considered as around and termed as a time window. Suppose, before finding the current block, if you had found six blocks previously, the reward will be calculated based on the previous blocks, without a transaction fee. But some pools might include a transaction fee.
Thus this article discussed Bitcoin mining pools and the payment methods used in the bitcoin mining pools. It was found that, among all mining pools, Antpool is the largest mining pool, with a hash rate of 15%. So, become a miner by properly choosing a bitcoin wallet and bitcoin software and earn more by choosing appropriate mining pools.
HussaiN is a full-time professional blogger from India. He is passionate about content writing, Tech enthusiast & computer technologies. Apart from content writing on the internet, he likes reading various tech magazines and several other blogs on the internet.