Which Bitcoin Mining Pool Is Best?
Bitcoin mining pools are a necessity for anyone new getting into mining BTC. Working alone simply isn’t an option if you’re wanting to win some of the Bitcoin block reward.
Back when Satoshi Nakamto launched Bitcoin, it was possible to mine Bitcoin on a laptop, but as Bitcoin grew up the hashrate needed to mine has intensified.
CPU became useless to mine Bitcoin, and now GPU isn’t even that competitive against the most powerful ASICs mining rigs.
The leading ASICs mining rigs have a hashrate of around 110 TH/s, and priced at almost $3000 you really want to make sure mining Bitcoin is profitable for you.
That said, even if you have the most powerful mining rig, so do thousands of other miners. The chance of you mining Bitcoin and winning the Bitcoin Block Reward, therefore, are virtually zero, if you mine alone.
With the competition for newly minted Bitcoin stiffening every year, it’s imperative that anyone wanting to mine Bitcoin joins a mining pool.
What Is A Bitcoin Mining Pool?
A Mining Pool is a consortium of Bitcoin miners joining forces to make their combined computing power (hashrate) more competitive.
All miners in a mining pool allocate their individual hashrate to the mining pool’s combined hashrate.
The united effort ensures that every single individual miner in the mining pool is much more competitive no matter how much or little Bitcoin hashrate they can offer.
The more hashrate, the more likely one is to win the Bitcoin Block Reward, so the combined hashrate of the Bitcoin mining pool gives any Bitcoin miner a much greater chance of winning the Block Reward.
The rewards are then divided among all miners who contribute to the mining pool, and the payment is awarded for the proportion of each miner’s individual Bitcoin hashrate.
Joining a Bitcoin Mining Pool is a Must
Joining a Bitcoin mining pool is an absolute no brainer, and anyone who mines BTC solo simply has to join one to have any hope of making a profit.
With billions of dollars being spent by huge companies to build huge Bitcoin mining farms, it means the competition for BTC is getting more difficult.
With mining pools you are awarded ‘shares’ for your proof of work, and these are redeemed for BTC when you choose to claim your Bitcoin rewards.
Therefore, working with thousands of other miners, all ploughing your Bitcoin hashrate to the common good ensures you have a very realistic chance of earning the Bitcoin rewards.
Before joining a mining pool you should fully research the company and its payment method.
Bitcoin mining pools are all mostly legitimate, but some have payment methods to suit different Bitcoin miners.
All mining pools take a fee. Of course, they do, they’re not going to offer their services for nothing, and some claim to have zero fees, which they do for one thing but they will have hidden fees.
There are several different payment methods and understanding them is important, because it all depends on what you offer the mining pool as to which method would be better for you.
The Most Common Payment Methods
Proportional: These mining pools are probably the most common of all pools. Miners contributing to the pool’s hashrate receive shares up until the point at which the pool wins the block reward. After that, miners receive rewards proportional to the number of shares they hold.
The issue with this method is you either need a powerful mining rig, or you need to find a pool that has a lower hashrate, so you become one of whales of the mining pool.
Pay Per Last N Shares (PPLNS): This is like proportional, but each share can be rewarded on several rounds. It can be quite lucrative, but it is also based on luck. The PPLNS method calculates your payments for the shares you submitted during a shift, but the catch is that it also depends on the amount other miners have submitted too.
As said, this method can be lucrative, but it’s also the luck of the draw. Your earnings can fluctuate, but when many miners leave or join affects your earnings in a positive or negative way.
Pay-per-Share (PPS): Each time a share is submitted, a miner is paid a fixed amount. This way is believed to be the safest way for payments. The main catch with this method, however, is that it usually means higher pool fees.
FPPS: This is similar to PPS, but it also divides the mining fee and adds a standard transaction fee to the regular block rewards.
Which Mining Pool Should You Join?
There isn’t an exact science behind joining the best Bitcoin mining pool. There are many factors to consider, and what might suit you might not suit someone else.
When considering joining a BTC mining pool it’s important to research as much about the pool and its competitors as possible, so you know exactly how it works.
Not all mining pools are created or run equally or transparently. Some of them have a tarnished history and many complaints seep out of the mining pool eco-system. That said, they still have tens of thousands of miners in their ranks.
Some Recommended Mining Pools
Poolin is based in China and is a multi-currency mining pool. It was launched by the people behind BTC.com. Poolin’s payment structure is FPPS, and they offer extra bonuses for mining other cryptocurrencies.
Although the BTC Block Reward distribution fluctuates a little, Poolin is always near the top and generally mines about 20% of all Bitcoins a year.
There are currently 747,000 miners contributing to the Poolin hahsrate, which is 20.13 EH/s.
F2Pool is a geographically distributed mining pool. Having originated from China, F2Pool have since branched out and now have presence in Europe and the US. Launched in 2013, F2Pool is one of the oldest mining pools, and it’s also one of the biggest and most trusted mining pools.
The payment method is PPS, and although the mining fee is relatively high, there are no hidden fees.
F2Pool also offer 40 different cryptocurrencies to mine, and claim to be the biggest Bitcoin mining pool by hashrate.
They’re known for being beginner friendly as the setting up process is as easy as it gets for mining pools.
They use world leading technology, transparent revenue and unique architecture to effectively prevent DDoS attacks.
AntPool is another mining pool based in China. The mining pool is owned by ASICs Antminer manufacturer Bitmain.
Although Bitmain has a tarnished history, Antpool is one of the most popular mining pools. Bitmain claim to have 2,000 servers geographically distributed in favourable mining conditions, so they claim to offer year-round uninterrupted mining pool.
Antpool currently mines about 10% of all Bitcoin, and they also offer mining for 9 other cryptocurrencies.
Antpool has a PPS and PPLNS payment method so it gives miners an option of what’s best for them. Antpool also claimit doesn’t charge any fees for using the mining pool. But this is not 100% correct. While Antpool does not directly charge fees, it also doen’tt disclose the Bitcoin transaction fees that are collected.
P2Pool is my favourite mining pool. Unlike the others, P2Pool is peer-to-peer, decentralized mining pool, which makes it a truly global mining pool. It also makes it more resistant to hackers than all centralized mining pools.
The payment method is PPLNS, but the fees can be a little confusing for beginners, because the fee you pay depends on which node you choose to mine with.
P2Pool nodes work on a chain of shares similar to how Bitcoin operates. Each node works on a block that includes payouts to the previous shares’ owners and the node itself.
Unlike other mining pools the payments are done automatically and P2Pool cannot keep your Bitcoin, unlike the others mentioned.
The main problem with P2Pool is that it isn’t beginner friendly at all. As well as the confusing payment method, all miners are required to run a full node.
Mining Bitcoin With a Mining Pool
Mining Bitcoin allows you to turn power into Bitcoin, and although many doubters claim it’s a waste of electricity, they simply don’t understand the benefits Bitcoin will bring to the world.
Mining Bitcoin is an ultra competitive industry, and for good reason. Billions of dollars is being spent every year on mining equipment, and the Bitcoin hashrate continues to hit new all time highs.
With Bitcoin mining being so competitive, joining a Bitcoin mining pool is a must for anybody getting into mining.
Most BiTC mining pools are legitimate, but you really should do as much research as possible and understand all the payment methods before choosing which mining pool is right for you.
Author: Tommy Limpitlaw
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