Individually, each member of a mining pool contributes his or her processing power to the effort to find a block as part of the mining process. Typically, the pool will receive a reward if the efforts are successful, usually in the form of the cryptocurrency that is associated with the pool.
Cryptocurrency miners have the option of going solo with their own dedicated devices, or of joining a mining pool where multiple miners and their devices complement each other’s hashing output. Adding six mining devices each offering 335 megahashes per second (MH/s) can generate a cumulative 2 gigahashes of mining power, resulting in faster hash function processing.
Method 1 – Pay-per-Share – PPS allows miners to earn an instant, guaranteed payout when they contribute to the probability that a block is discovered by the pool. Method 2 – Proportional – Once the mining round is over, miners earn shares. The value of each share is only calculated at the end of each round, so all shares are equal.
Method 3 – Solo Mining Pool – Solo pools work the same as usual pools except block rewards aren’t distributed to all miners. In a solo pool, the miner who finds the block receives the entire reward.
Method 4 – Pay-per-last-N-shares – It works similarly to Proportional, but instead of calculating the reward based on all shares in the last round, it calculates it based on N last shares. It means that when a block is found, each miner’s reward is calculated based on his or her contribution to the last N pool shares. As a result, if the round is short enough, all miners get more profit.
Method 5 – Pooled mining – The pooled mining system, called “slush’s system” after it was originally used on a pool called “slush’s pool”, gives less weight to older shares from the beginning of a block round than to more recent shares.
Method 6 – Peer-to-Peer Mining Pool – Peer-to-peer mining pools (P2Pools) decentralize the responsibility of pool servers, removing the risk of cheating by pool operators and single points of failure. Share chains allow miners to mine at a lower difficulty at a rate of one block every 30 seconds on a side blockchain.