Bitcoin Forum

Hi Guys,

I have opened a new mining pool using the MPOS code base.  Here's the info so far:

Pool:                Cucumber Pool
Website:             http://cucumberpool.us
Proxy:               No
Generation address:  N\A
Coinbase signature:  ????
Payout method:       PPS
Fee:                 .1 - config default, is this %?
Pay Tx Reward:       No
Vardiff:             2016
Local Work:          stratum
Pay Orphans:         No
Min Withdrawal:      1
Merge Mining:        No

As you can see, I'm confused on two options - the coinbase signature and the fee.  The config is mostly at the default, so should I change anything to make it more appealing to potential miners?  

Edited 1/4/2015 - Changed to PPS based on senior user's recommendation

Prop? Eh? You don't use Prop (or PPS)

Please at least read up about pool payment options here:
https://bitcointalk.org/index.php?topic=104664.msg1146110#msg1146110

Ok, so if you were going to make a hypothetical recommendation, what reward system would you recommend?

I have changed it to PPS.

I'm pretty sure if kano were to make a hypothetical recommendation, he'd tell you to go with the CK pool.

I've gotta ask what you're doing.  You're looking for recommendations on how to setup/run a pool to what end?  If you're expecting people to come and mine on a pool that you're launching you might want to have a bit more knowledge to start.  Not knowing what you're doing when setting up and configuring a pool is just asking for trouble.  Ask yourself if you'd go and deposit money into a bank where nobody in the bank knew how it worked and just setup something at random.

I have a general gist of how pools work, but yes it would be ideal to get people in there to mine.  I always learn by doing, so that's the purpose of this project.  But on the other hand, I'm here asking for advice from seasoned veterans to avoid getting into any kind of trouble.

In that case, let me give you some advice :).

You're in for an uphill battle.  Starting a new BTC mining pool is going to be tough.  New pools are met with extreme prejudice because of the number of scammers who have taken advantage of the community.

I wish you luck.

Yes, I thought that might be the case going in.  It's ok, I have a vast amount of patience (I have three kids).

The main advice I'd give is that picking PPS for the payment method is a bit risky. This means you'll be paying miners out of pocket until you find a block. You are taking the risk of variance. There's a paper around somewhere that shows a formula for computing what sort of buffer you need, in bitcoins, to run a PPS pool with a low risk of ruin (ie. running out of money to pay miners). It's large - you'll be need a few hundred thousand dollars of bitcoins if I recall correctly.

The other downside of PPS is you are open to block withholding attacks. A miner mines with you but withholds all solutions that would solve a bitcoin block. You are still paying them PPS so they lose nothing. The pool loses a lot.

Interesting...  Seems like PPS isn't ideal for a new pool starting out.  Would it be better to start with something else until blocks are found, then switch to PPS?

PPS itself isn't ideal for a pool operator as the pool takes on all the risk.  Like mmpool states, the miner gets paid no matter what and it's up to you to figure out how to ensure the payments happen, regardless of whether or not your pool has found a block.  Here's a simple example of what I mean:

Pool finds a block of BTC, yay!  Unfortunately, it took twice as many shares as expected to do so.  You have to pay your miners 50BTC but you've only got 25BTC from the block reward.  Orphaned blocks are bad, too.  You as the pool operator expect to have that 25BTC to pay your miners, but you don't because the block the pool submitted was orphaned.

There's a reason that the vast majority of the pools that do offer PPS do so at an extremely high fee percentage (4% or more).  There is currently only 1 PPS-based pool that I know which charges 0% fees, and that's BitAffNet.  You can find quite a few threads on these forums about them - I'd suggest looking them over.

Want to know how to become a PPS BTC millionaire pool operator......start off with a  billion BTC. :P

That would be pretty awesome!  But, I'm not looking for a get rich thing, just something that works and is fun.  I have a pretty good day job so this is just a hobby.  If I can make a couple of bucks, awesome.  If not, hell, it's still fun - I love working with new technology.

So looks like most pools favor PPLNS.  It seems like that cuts out of pocket expenses, correct?