A Bitcoin mining pool payout is when a group of miners combine their resources and computing power to increase their chances of receiving a reward for mining a block. When a block is successfully mined, the reward is split between the miners in the pool, according to the amount of work they contributed to the pool. This is done by measuring the hashing power of each miner’s hardware and assigning them shares of rewards based on the proportion of the total pool’s hash rate that they provide.
The pool operator generally takes a fee of around 1-2% of the total reward to cover their costs. This is known as the pool fee. When a block is mined, the operator takes the pool fee first and then pays out the remainder of the reward to the miners according to their shares.
Payouts can be done in three different ways:
- Proportional: A proportional payout system pays miners according to the amount of work they contribute to the pool. This is the most popular payout system and is the one used by most major pools.
- Pay Per Share (PPS): A PPS payout system pays miners based on the number of shares they submit to the pool. This system is beneficial to miners who have lower hashing power, as they will still receive a reward for their work.
- Full Pay Per Share (FPPS): A FPPS payout system pays miners according to the amount of work they contribute, as well as the number of shares they submit to the pool. This system is more beneficial to miners with higher hashing power, as they will receive a larger reward for their work.
Pool payouts are an essential part of the Bitcoin mining process and are important for ensuring miners are fairly rewarded for their work. They also provide miners with greater stability and reliability, as the reward is split between a larger group of miners rather than just one.