PPS offers an immediate fixed payment for each resolved mining share. With this payment method, the miner receives a standard payment rate for each resolved stake. Each share has a certain amount of cryptocurrency that can be mined. This model is profitable during a bear trend of a particular coin.
PPLNS then distributes the profit according to the amount of shares contributed by the miners. If a mining pool mines several blocks per day, miners earn a high profit; if a mining pool fails to mine a block throughout the day, the miner's payout for the day is zero.
PPS + is a mixture of the two modes mentioned above: PPS and PPLNS. The block reward is calculated according to the PPS model. The mining fee / transaction fee is calculated according to the PPLNS regime. In this way, the miner can receive additional income in the form of a share of transaction fees based on the PPLNS method. This is the main disadvantage of the PPS model.
FPPS – in this mode, the block reward and mining fee are calculated based on the theoretical profit. Calculate a standard transaction fee in a certain period and distribute it among the miners according to their contribution in the mining pool. This increases the miners' profit by sharing a portion of the transaction fees.
By using the PPS and FPPS payment methods, you will receive payments regardless of whether the mining pool finds a block or not. This is the biggest advantage over PPLNS.
When we talk about the right mining pool, we don't mean the size of its output or fees, but the payout structure and type of remuneration. If you are new to mining altcoins or even Bitcoin, understanding the payment pool terminology can be quite difficult. Here in this guide we will explain the pool reward structure. It is a Bitcoin pool or an Ethereum pool, each pool has its own payment models. Currently, pools more often pay for a share (Share). A mining stake is the proportion of your contribution to solving a block that is proportional to the performance of your device. The most famous pool reward structure looks like this:
- PROP – proportional payment,
- FPPS – full payment for the share,
- SMPPS – total maximum payment per share,
- ESMPPS – adjusted total maximum payment per share,
- CPPSRB – limited payment for a share with delayed payment,
- PPS – simple payment for the share
- PPLNS – payment for the last N shares
- PPS + – payment for share +. Of the above payment types, PPS and PPLNS are the two payment models most commonly used in mining pools today. Before explaining the payment principle of both PPS and PPLNS, we will make a brief note about mining pools.
PPS and PPLNS are the two most popular payment models used by many cryptocurrency pools. PPS stands for “Pay Per Share” and PPLNS stands for “Pay Per Last N Shares”. In the PPS model, miners receive a payment for each hash they solve, regardless of whether a block is eventually found or not. This means that miners receive a steady income regardless of how often blocks are mined. This model pays lower rates than other models because the pool is at risk of paying less if blocks are found frequently, but less if blocks are found infrequently.
On the other hand, in the PPLNS model, gauges are only paid when a block is found, depending on how many chars were involved in finding it. Using this model, the pool stores data on the number of chars that each gauge has contributed over the last N blocks. When a block is found, the pool divides the rewards between the gauges depending on how many chars each of them contributed to solving the block. This model pays higher rates than PPS, but less stable because payments vary depending on the number of chars that contribute to solving a block.
Both models have their advantages and disadvantages, and it depends on the gaugers' preferences which model is more suitable for them.
PPLNS stands for Pay Per Last (luck) N Share - payment for the last (luck of the pool) N share. This method calculates your payment based on the number of shares you sent to the pool during mining. The method includes a time-based or share-based offset system that determines your payment. Your pool may find sequence blocks or in overtime, which can have a huge impact on payouts. PPLNS involves a significant element of luck and you will notice huge swings in your 24 hour payout. If you keep your farm in one pool, your payments will be stable and will only vary when new miners join or leave the pool. For a more detailed explanation about the PPLNS method, we recommend reading this discussion. PPS Pay Per Share - payment per share. The pool pays you according to the average number of shares you put on the pool while searching for blocks. PPS pays you at a fixed rate and is a more objective method that completely eliminates the element of luck. In the PPS method, regardless of which pools are lucky to find blocks or not, you will get 100% payout at the end of the day. This is because there is a standard set of payouts for each miner based on hash rate. The payment will not be more than 100% or less. You can easily calculate your potential income using this PPS method. On the other hand, with the PPLNS payment system, you can get more than 100% (or less) on average. It will all depend on the overall luck of the pool, how well the pool does in finding new blocks.
What to choose: PPS or PPLNS?
This is one of the common questions new miners encounter. Should I choose a pool with “Pay Per Share” or “Pay Per Last N Share”?
If you are a person who rarely changes pools, then PPLNS is definitely for you because such pools reward their loyal miners well.
Pay Per Share (PPS): Whether you need fixed payouts at the end of the day to stabilize your income or for any other reason, our recommendation is PPS. Pay Per Share works well for large farms that can quickly calculate and have stable statistics based on their hash power.
PPS is good for big miners but very bad for pool owners because there is a guaranteed payout for work regardless of whether the pool solves the block or not. Because of this and those who change pools too often (rogue miners), most pools have switched to the PPLNS payment model.
Payment for Last N Shares (PPLNS): If you want to accumulate and store more coins, we definitely recommend PPLNS. For each block your pool finds, you receive a share based on your hashing power, including the pool's luck factor (when the pool finds blocks quickly). Unlike PPS, you will get paid more often with PPLNS and ultimately be rewarded more with PPLNS than with PPS.
However, due to the huge dispersion, it is very difficult to calculate your mining earnings. PPLNS is good for both intermediate miners and pool owners because payouts are based only on blocks found.
If your pool has more luck, you'll see payouts more often. It is for this reason that miners stay on the pool where the hashing power is high, with the assumption that the pool will find blocks very often.
To find out if a pool is PPS or PPLNS, you need to check its website or refer to its documentation. It should state what kind of payment system the pool uses. If it is not mentioned on the website, you can ask in the mining community or discussion forums.
Which way is better? PPS VS PPLNS
With so many aspects to consider, it's natural to ask which is better. However, comparing standard payment schemes is not easy. PPLNS pools can bring more profit in the long run, but are more prone to short-term fluctuations in network complexity. On the other hand, PPS pools can promise a stable profit from the very beginning, but you can get a bigger return on invested funds for many years by looking elsewhere. As they say: it won't work out in love, but it will work out in cryptocurrency mining 🙂
