I plan to, but unfortunately don't have the time right now to revise it in a way that will do it justice, so I have edited the OP to request the reader to also read post#15 for clarifications.

OK, clarifications are in order. Both Rosenfeld and DrHaribo are correct. It was too hasty of me to outright declare that score-based and PPLNS pools are not suitable for intermittent miners. I request miners to read up on the links Rosenfeld has provided.

What I did mean, however, is that the high variance is potentially a deal breaker in these cases. Although the total reward over time averages out, for the intermittent miner, the uncertainty associated with high variance can be a real annoyance. If the intermittent nature is out of the miner's control, he/she is already frustrated with the unpredictable downtime, and the variance adds to the chagrin. If they are intermittent by choice, they would (i assume) look for some certainty for rewards when the do mine. That's why I think a reward system like PPS is more suitable (psychologically) for the intermittent miner where they know exactly how much they are getting paid for the x hours they mined today.

PS: Rosenfeld, both your links point to the same file, please correct that.
PPS: note for newbies (and some other users) -- please take a close look at the comments made by Rosenfeld, DrHaribo, Eleuthria and Slush and see how nice they were in making corrective remarks. They basically found faults with what I wrote and were so very civil about pointing them out. I keep seeing comments from some users in different parts of this forum that could really do with some maturity. Being nice doesn't hurt, you know.

How do you verify that a pool has good security? And by security, do you mean whether your money is safe with them? Pooled mining largely depends on the trust people put in pool operators. You should, no doubt, only mine at pools that are well-reputed. It's fairly easy to read up on the comments about a certain pool in this forum to get a feel for that pool's integrity.

Edited to reflect corrections/comments from Eleuthria and Slush.

@slush, I simply love your pool, man. You're among my top three, especially since your heroic efforts during the DDoS and server migration problems  

I mention 'only' for the payout method because i would like to have both options 

This question gets asked by every miner at the beginning when they are testing the waters with bitcoin mining. A lot of great pools are out there and at the end of the day it boils down to your personal choice. There is really no single best pool, but there is most likely a pool that is right for you, based on _your_ requirements and preferences. This guide won’t tell you which pool is best, but it will help you choose one according to your own liking.

(This guide is more suitable for miners with a limited hashing power, those who are at the beginning stages of their bitcoin mining commitments or those who consider themselves to be casual miners. Hardcore miners, especially those with multi-GHash rigs already know all there is to know about different pools and have already figured out what works for them.)

Before I go into more detail, please note that there are at least two pretty comprehensive lists of pool features available to you (at least that I know of):

• The mining pools feature table (https://bitcointalk.org/index.php?topic=12920.0)
• Comparison of mining pools (https://en.bitcoin.it/wiki/Comparison_of_mining_pools)

You should read up on the above information before you go through this guide. While these places are excellent sources of information, they can be a bit overwhelming for the beginner, hence my effort to ease things a bit by providing a subjective guide below.

I found that the following factors were most important for me in choosing the right pool:

• What is the reward method – Proportional/Pay Per Share/Score Based/PPLNS
• What fee they charge for mining and withdrawal of funds
• How frequently they find a block (means how frequently I get rewarded)
• How easy it is to withdraw funds
• What kind of stats they provide
• Do they offer BTC + NMC merged mining?
• How stable is the pool?

What you need to do is sort the above points according to importance as per your personal preference and then use them to prune out the pools that do not meet your required criteria. For example, my top requirement at the moment is merged mining, since it offers 10% to 13% more reward at the moment without any extra effort on my part. So pools that do not offer merged mining automatically get pushed to second tier in my list no matter how well they do in other areas.

Important: _Always_ set up one or more backup pools in your mining software (all major miners offer this option, please consult their respective threads for instructions if you need help). Even the most robustly setup pools can experience downtimes for various reasons, so your miner will be left without any work if something like that happens when you are AFK.

So here goes…

• Pool Reward Method: Different pools follow different reward methods (note: ‘reward’ is what you earn when you mine with a pool, as opposed to ‘payout’, which is the amount you withdraw from the pool after you have generated some reward). Different reward methods are discussed in the above link for ‘Comparison of mining pools’ link provided above, so go read up. The most common are :
      o   Proportionate – where you get paid an amount proportional to the number of shares you submitted compared to the total number of shares in that round,
      o   Pay-per-share – where you get paid a fixed amount per share you submit regardless of the length of the round,
      o   Score-based – where your rewards are calculated based on the score the pool assigns you, which quickly diminishes as soon as you stop mining,
      o   PPLNS – where only the last N shares are considered to calculate your reward
  
  There are other variants as well, notably the SMPPS method used by Eligius.  What you need to know in reality is how the above methods impact your rewards. If you are a casual miner who mines occasionally or if you run a rig that for some reason cannot maintain a stable connection with the pool (bad internet, hardware problems, miner freezing up, etc. etc.), then score-based and PPLNS pools require special consideration on your part. Score-based pools punish the miner who, for whatever reason, does not or cannot maintain a stable mining operation at the pool for the entire duration of the round. If mining with slush, for example, getting disconnected for just 5 minutes will reduce your score to virtually zero and if they find a block at that time, you get paid nothing, even though you mined with them for the last 4 hours. On the other hand, you get paid in full if you are lucky enough to join slush just 5 (or maybe 10? I somehow feel that it takes longer to build up score than to diminish it) minutes before they solve a block even if that round has been running for several hours. The average reward will even out over the long run, but that also means you will need to stick to that one pool over an extended period in order to reap the expected reward. A key requirement for intermittent miners is knowing how much reward they are getting for whatever length of time they do manage to mine, which score-based and PPLNS (and other fancy variants) do not allow. It is better, in my opinion, to stick to zero-fee PPS pools in this case since you get the expected reward whenever you mine.
  
  Pay-per-share and proportionate pools do not have the intermittent issue and you can mine with them on and off and get paid for whatever work you have done for them. Proportionate pools have higher variance than others, meaning that for short rounds you get paid a lot, but for long rounds you get paid much less. Since you get paid in proportion to the number of shares you submitted, if your hashing power is 1% of the pool, you get paid 50 cents for an hour-long round (less any pool fees). You also get that same 50 cents if the round lasts for 10 hours, so you get the picture. Proportionate pools are also a prime target for pool hoppers, which can reduce the actual reward you earn.
  
  
• Pool Fees: There are zero-fee pools and there are pools that charge a fee for mining with them. Pool fees are not necessarily a bad thing – it’s usually worth it to pay the fee in exchange of the benefits they offer. Deepbit charges 3% fee for proportionate mining, but they pay for invalid blocks. But if you are adamant not to pay any fee, you can still find pools that charge nothing or almost nothing to mine with them. Please note that not all pools clearly declare their fee structures, especially Pay-per-share pools that only declare how much they pay for each share, and you have to calculate the pool fee from that information (this is fairly simple, btw, you just find the current theoretical value per share by dividing 50 by the current difficulty, then subtract the pool’s declared pay-per-share value to find the pool’s fee). You can find summary of pool fees in the links provided above.
  
  
• Pool Speed: The more GHash the pool has, the faster they will find blocks. Deepbit, with their current speed of 3328 GHash/s, seems to find 2 blocks per hour in average. Smaller pools can take days or weeks to find a block. You will roughly get the same total reward over an extended period from faster and slower pools, but whether you will have the patience to wait for days for your reward (especially if you are a sub-GHash miner and your rewards are small), is completely up to you.
  
  
• Fund withdrawal/Payout: Do you want your rewards to be automatically sent to your wallet? Do you want an option to send out funds to your wallet as and when you feel necessary? Different pools have different payout policies that you may want to review from the ‘The mining pools feature table’ link provided above. Some pools, like slush, only give you the option for automatic payouts once the confirmed reward crosses the payout limit you have set. Eligius automatically sends your payout when your reward crosses approximately 0.67108864 BTC or after one week of inactivity. This may be a deal breaker for miners with small hash-power, as with a 300 MHash rig mining continuously you will have to wait 3 days before you get a payout. On top of that, once you do receive a payout from eligius, you have to wait for 120 confirmations (takes about 18 hours in my case) before your bitcoin client will let you spend it.
  Other pools let you withdraw funds whenever you feel like it once you have enough confirmed rewards in your account. They usually impose a minimum amount of reward, which is generally very low, like 0.01 BTC, but for NMCBit the minimum is 0.10 BTC. These limits are not usually declared and you find out only when you try to withdraw funds. Some pools let you withdraw the full amount in your account, but some, like Bitcoins.lc, only let you withdraw up to two decimal points.
  While some pools let you withdraw funds as soon as a block is solved, others make you wait for 100 or 120 confirmations of the block before you can withdraw those funds. More details about this can be found at the links provided above.
  
  
• Pool Stats: Some pools provide awesome graphs and statistics of your mining records with them. Others provide very few stats, the rest are in between. ARS offers fantastic stats, ABCPool offers great stats as well, but for a fee. Eligius is very frugal with stats. Slush and deepbit are somewhere in between, although slush offers performance graphs where deepbit doesn’t. How important detailed stats are depends completely upon your personal preference, so you need to shop around a bit in this regard.
  
  
• Merged Mining: At present this is quite a nice addition when a pool offers merged mining. What this basically means is that you continue mining like you always do, but the pool gives you extra Namecoins for the same amount of mining and you can at the moment exchange those namecoins at an exchange (the going rate at bitparking is ~0.0104 BTC per namecoin). Since current Namecoin difficulty is much lower than Bitcoin, you essentially earn about 10% extra with the same hashrate, which is a big plus. Some pools like NMCbit even offer the option to directly convert namecoins to bitcoins without having to go through an exchange, but they (seem to) charge a fee that is not clearly declared (i.e. they were offering 0.01 BTC per NMC when the going rate at bitparking was 0.011 BTC per NMC).
  
  
• Pool Stability: You (naturally) want to get the most out of your mining. Some pools offer better stability, less stales than others. This status keeps changing as pools keep improving themselves. On the other hand, great pools can temporarily become unattractive due to factors like DDoS attacks and server migrations. You need to find out more by reading up on the most recent posts in their own forums or in their respective threads in this forum.

At some point after you take mining seriously (or maybe just browsing the forum), you will come across the idea of pool hopping. It’s basically a technique used by some miners to reap extra rewards by exploiting ‘flaws’ in reward methods, especially the proportionate reward method (although other reward methods like score-based have been proven hoppable, proportionate is claimed to be the easiest to hop). The extra rewards they collect come from other miners that are not hopping. Whether this is ethical or not is beyond the scope of this discussion (you will find quite a few discussions regarding the ethics of pool hopping, feel free to make up your own mind about it). Many pools these days actively discourage, or even ban pool hoppers. Others implement hop-proof reward methods like PPLNS or Pay-per-share. I am not going to tell you whether you should or should not become a pool hopper, it is entirely up to you. But you should avoid proportionate pools that do not take adequate measures to deter pool hoppers, since it will reduce your rewards.

So, that’s some of the things you need to consider while choosing the right pool for you. As I have mentioned before, it all comes down to your own personal preferences. I have just tried to make it easier for you to make sense of all the info available about the pools in their websites as well as this forum. Good luck and happy mining.

Comments, suggestions, corrections are highly welcome.

[Edit]: I have modified the pool reward section.

completely agree -- if BT is concentrating his efforts on making the pool more robust, then that's highly commendable. by all means put merged mining on hold until you accomplish those (more important) goals. it's not like i have to mine here, it's just that i'd like to

i only wanted to know what's going on.

BT hasn't posted in this forum since 28th, it appears. so looks like we just have to wait...

slush, hats off to you for your effort and final success in bringing the pool up. i hope you don't get upset about the unhappy campers that complained about non-payment during the downtime. you will notice that there were only a few of them versus a LOT more people who showed their patience and supported you. it's bad mining strategy if someone hasn't set up their miner to fall back to another pool in case of downtime and it's not your fault if anyone has lost any amount of mining time due to this reason.

kudos.

Well, everyone seems pretty eager to know about Merged Mining at ARS. So what I'd like to know from BT is confirmation of any of the following (I think everyone wants to know):

  * Merged Mining is just around the corner, we are working out the final kinks, or
  * Merged Mining is being worked on and will be implemented soon, or
  * Merged Mining is being considered, but will take some time, so don't hold your breath, or
  * Merged Mining is not planned at the moment, but might be implemented in the future, or
  * Merged Mining is not planned and will not be implemented in the foreseeable future

BT should note that the amount of interest regarding merged mining at ARS is an excellent sign meaning that a lot of people want to join ARS but are currently on the fence due to the added benefit of merged mining at other pools. So please, let us know as soon as you can...

yeah, at least knowing that MM is planned and being worked on (or not) would be great. a lot of us would drop other pools to be permanent here once MM is implemented. right now MM is giving almost 10% to 13% boost to total reward (depending on the price of NMC), and that figure cannot be ignored.

ars is among the greatest pools, and the stats are just brilliant, so please let us know the plans...

this sounds pretty strange. bulanula is right -- merged mining should NOT create BSODs at your end. the implementation of merged mining is done completely at the server (slush's) end, nothing has changed at your end. your bitcoin miner is still mining only for bitcoin. the additional namecoin calculations are done at slush's end, not your's. so in theory your pc should not see any change whatsoever in terms of it own mining activities.

in theory...

i have worked with windows long enough to know that it can suffer from errors that apparently have absolutely no goddam relation with what you are doing. it can fail in completely mysterious ways that will leave even the most experienced users scratching their heads. i have seen this from 3.1 to the latest and greatest 7. so even though there should not be ANY reason between slush's merged mining implementation and your BSODs, with windows you just never know...

my suggestion is just switch to linux (dual-boot ubuntu 10.4 LTS with your current windows) and use it for mining. it takes some work, but totally worth it in terms of stability and reduction of stales/rejections.

really i second that. the stats at ARS are fantastic, and there is no restriction on withdrawal like eligius' 0.67.. btc minimum balance (or one week of inactivity). i will definitely switch to ARS as soon as they implement merged mining.

wow, thanks a lot for the info. do we divide the numbers by 100,000,000 to get the actual NMC amount (that seems to correspond to what my balance is)?

i just got a payment, feels great. won't mind waiting for the next payment now that i know the system is actually working and i registered my NMC address correctly

It's a tad frustrating not knowing how much namecoin there is in my account or even if my namecoin address registration went through correctly. with my current hash rate it's going to take quite a while to reach 43 namecoins. but i guess there's nothing to do but wait...

+1

sorry, just realized my mistake, a share is not submitted by multiple users and still be valid. so no need to multiply by number of users...

It's one exponent function per share PER USER. if you have 200 users you are doing this calculation 200 times for each share? then adding the new score to the cumulative score for each user and storing that in memory? for all the millions of shares?

not that it would be difficult for the modern pc, but my question is if it is done on an ongoing basis, then why does it take about 10 minutes to publish the rewards after each round?

BTW, thx for the lightning fast response

Question for Slush:

In describing the logic/calculation of the score-based system, you mentioned this:

====
Matematically said, for every submitted share, pool perform

Code:
score = score + exp(round_time/C)

round_time is count of seconds between "now" and time when round started, C is magic constant which define how fast old shares lose their value. All following calculations are using C=300, but it may be changed in the future to provide the best cheatproof/usability ratio.

And on the end of round, system calculate rewards using formula

Code:
reward = user score / total score * 50
====

Is it really done for EVERY submitted share for EVERY user? that's a lot of calculations, no? or is there some other interval used to calculate the scores? maybe the scores are calculated at the end of each round?

please enlighten....

Let me repeat - i most definitely appreciate all the work he is doing and all the contribution to the community. it is a matter of preference for everyone and there are no entry/exit barriers, so people can mine anywhere they like.

that said, i would like to mention my preference:

Wait forever for payouts or get it much quicker and pay a fee? --i don't mind waiting about 24 hours if it saves me 10 coins out of every 100 i earn.

merged mining that is working and being paid out - at least one other pool is doing this for 0% fee (simplecoin) and slush is doing it for 2% fee in their score-based system.

ability to cash out NMC instantly -- again it is a matter of preference. currently he is charging 5% fee if i compare it with going rate at bitparking.com -- i'd rather take the pain and save that 5% for myself

pioneering and supporting the namecoin community is highly commendable, for sure. i just wanted to put everything is perspective. it's a completely open market and everyone can mine wherever they want. just my two cents (in whichever currency you prefer  )...

not that i don't appreciate all the hard work you're putting in, but what incentive do i have not to mine at eligius' pool instead of yours? they charge no fees and also have merged mining...

At the current difficulty, each share is worth 0.0000340554217934266 while you are paying 0.0000317852781277 per share. This is approximately 7% less. Then there is the 3% fee 'on all balance redemptions'. Does this mean you are charging 10% fee in total? I am not really accusing you or anything, but I sure would like a clarification...

Has anyone else checked this? Am I missing something?