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Author Topic: Why do miners join pools?  (Read 817 times)
luv2drnkbr
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November 24, 2011, 04:51:25 AM
 #1

I don't understand.  One of the main points of Bitcoin is decentralization, but contributing to a pool allows for a 51% attack, even when the network grows bigger.  Also, you pay a fee to be a part of the pool.

So if you help maintain network security AND make more money by solo mining, why in the heck are you in a pool?

Is it for variance reduction (i.e. smaller more frequent payments)?

If that's the case, why has the entire community not switched over to the p2pool?

I don't get it.  I'm not a miner though.

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boonies4u
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November 24, 2011, 05:13:00 AM
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Is it for variance reduction (i.e. smaller more frequent payments)?

Yes, payouts are smaller, more frequent, and more predictable.
/thread
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November 24, 2011, 05:46:10 AM
 #3

but contributing to a pool allows for a 51% attack
Not really. And to the extent that it does, it will be fixed in the future.

Also, you pay a fee to be a part of the pool.
Most pools take no fee or a fee negligible with respect to the benefits they provide.

Is it for variance reduction (i.e. smaller more frequent payments)?
Yes. And to a smaller extent because it's more convenient and gives monitoring features. Also some things like merged mining and long polling require extra work if you mine solo. (So in fact you'll earn more in a pool than with plain solo)

If that's the case, why has the entire community not switched over to the p2pool?
p2pool uses difficult shares and is thus not suitable for small miners. It's great for large miners and proxy pools though.

I don't get it.  I'm not a miner though.
If you try mining solo you'll get it. I'm serious, you need to experience losing sleep wondering if you've found a block.

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November 24, 2011, 11:02:47 PM
 #4

large miners (1ghash+) have bills to pay, with solo they have a real chance of going weeks/months with no payout at all and still be as far from finding a block as when they began, and they can only calculate their profitability on whatever the current price is so with solomining it's difficult for them to know if they're actually profitable at all.  Small miners just have no real chance of seeing any kind of payout from solomining. 

Also I've solomined some of the alt chains when my expected block finding rate is a block/2 days and it's really unnerving to not even know if solomining is working properly because you don't see any kind of progress until you actually find a block.  You could setup your own private pool to counteract that but then what's the point of solomining in the first place (plenty of zero fee pools out there).
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