Bitcoin Mining Pools Explained

Bitcoin mining pools are groups of Bitcoin miners who join together to solve a block and share in its rewards. In the early days of Bitcoin, it was possible to mine Bitcoin with your computer CPU or high-speed video processor card. Today that’s no longer possible. As more people started mining, the difficulty of solving these puzzles increased greatly to the point where the only cost-effective method of mining today is using specialized hardware called ASICs.


What are Pools?



A mining pool is a group of miners who combine their computing power and split the mined bitcoin between participants. A disproportionately large number of blocks are mined by pools rather than by individual miners. ~~Miners can, however, choose to redirect their mining power to a different pool at any time. If they do so, they must amend their candidate blocks accordingly.


The Advantages

Using a mining pool has many advantages over using other types of Bitcoin mining hardware. For example, using a pool means you can get a smaller payout quicker than if you mine on your own, as well as receiving more frequent payouts rather than waiting for larger ones.


The Disadvantages

However, there are some disadvantages to these mining pools. It’s not unusual for an individual miner to be working with a pool that does not have its own data center. If so, then your miners could be scattered across several different locations. There’s also no direct way of measuring how much power your miners are producing or how much you stand to earn in terms of Bitcoin value.

Where to Join a Pool?

There are many places to go online and find a pool, but it’s up to you how you want to do it. Most pools will require you to verify your personal information, such as your address and phone number, before allowing you into their groups. If they don’t have an official registration process or form that they use, just Google bitcoin mining pool signup and follow along with whatever comes up. Some pools even allow you to register without giving away too much personal information.


How Much Can You Earn in A Day?

Bitcoin miners can earn transaction fees paid by users for faster transaction processing, and they also get a share of each new bitcoin mining. Currently, a share is worth 12.5 bitcoins, which at the time of writing is worth nearly USD 130,000. Bitcoin mining pools exist because the computational power required to mine bitcoins on a single device rapidly becomes too much for one person to manage.


Pros and Cons of mining pools

Cryptocurrency mining is an arms race that rewards early adopters. You might have heard of Bitcoin, the first decentralized cryptocurrency that was released in early 2009. Similar digital currencies have crept into the worldwide market since then, including a spin-off from Bitcoin called Bitcoin Cash.