The surge in Ethereum mining continues to grow, and it’s not hard to see why. The world is evolving, and the digital realm must evolve with it. Cryptocurrency mining has become a popular way for “game changers” to profit from the changing landscape.
Investing in startups and blockchain technology has boomed in recent years, with many financial experts hailing it as the “next big thing” in the trading and financial sector.
The Ethereum network provides a strong foundation for various projects, startups, and other cryptocurrencies to rely on. Miners enjoy high profitability on Ethereum, and mining itself is relatively easy. They also ensure the authentication of transactions and their inclusion in the public ledger of the blockchain.
In this article, we will explore Ethereum mining pools and what they entail. We will guide you on how to choose an Ethereum mining pool and what you need for mining Ethereum.
What are Ethereum mining pools?
Ethereum mining pools are shared resources that distribute rewards among miners. Pools emerged when individual mining became nearly impossible and unprofitable for rogue miners.
A mining pool is a system where miners combine their processing power within a network and evenly distribute their rewards based on their contribution to finding a block. To receive a share of the rewards, members must provide a valid partial proof-of-work (POW).
Miners who participate in Ethereum mining receive ETH as their block reward, alongside transaction fees.
Best Ethereum mining pools
Dwarfpool
Dwarfpool is a powerful Ethereum pool that charges a 1% fee on block rewards. The pool pays out six times a day, but you need to accumulate at least 1.01 ETH before receiving a payout.
Ethpool/Ethermine
These two pools operate on separate websites but contribute to the same pool. Together, they possess around 26.8% of the network hashing power, making them the largest on the network. Both pools charge a 1% fee.
Nanopool
Nanopool is the third-largest Ethereum mining pool, with over 80,000 consistent miners and a network rate of around 14.4%. The pool fee is 1%, which is lower than most competitors. The minimum payout threshold is 0.2 ETH.
How to choose an Ethereum mining pool
Pool size
Mining pools vary in the number of members they have. It is advisable for beginners to join larger pools, as they offer a higher chance of receiving rewards, even if they may not be substantial at first.
Pool fees
Mining pools collect fees from miners to cover operational costs. Pay attention to the fee structure and computing power of payouts when choosing a pool. Some pools charge nominal fees, while others are fee-free.
Minimum payouts
Minimum payouts refer to the minimum amount you need to mine before receiving rewards. If you want regular payouts, join pools with low minimum payout thresholds. Payouts can be of different types, such as PPS, PPLNS, and PPS+.
PPS (Pay Per Share)
PPS is a payment mode where miners sell their hash rate to the pool and receive a fixed income. The fee is higher in this mode due to specific risks. Profit calculation is based on the number of shares submitted by miners.
PPLNS (Pay Per Last N Share)
In this mode, profits are allocated based on the number of shares contributed. It is closely tied to the block mined out. If a pool mines multiple blocks in a day, miners earn more; if no blocks are mined, there will be no payout.
PPS+ (Pay Per Share + Pay Per Last N Share)
PPS+ combines the features of PPS and PPLNS. Block rewards are resolved according to PPS standards, while transaction fee income is settled per the PPLNS mode.
What to do after choosing an Ethereum mining pool
Ethereum GU Mining Rig
To mine Ethereum, you need to have a Graphical Processing Unit (GPU). Consider the hardware and power consumption rate when choosing a GPU. A mining rig includes graphics cards, a motherboard, a cooling system, and a power supply.
Installing Ethminer
Once your node is connected to the Ethereum network, install the mining software called Ethminer. This software acts as a mediator between your mining pool and hardware.
Ethereum Wallet
An Ethereum wallet allows you to access your account, view transaction history, check balances, and interact with decentralized applications. Wallets offer more than just basic functionality, and you can change wallet addresses and providers as needed.
Joining a mining pool
Joining a mining pool allows you to combine your computational power with other miners, increasing your chances of solving coding puzzles and earning Ether. Mining in a pool is generally more profitable than solo mining.
Software installation
After acquiring the necessary mining hardware, carefully install the required software. Download the Ethereum blockchain and ensure your node is connected to the network. Geth is a recommended software due to its versatility.
Consider other factors such as weather conditions, equipment cost, and mining farm location when mining Ethereum.
Final thoughts
Joining a reliable Ethereum mining pool, such as Claymore Ethereum pool, is a wise decision. However, keep in mind that GPU pricing can be high, and market conditions can change. Understanding the market structure, mining processes, and choosing the right pool are crucial for a successful mining experience.
