PPLNS Payment Method

Mining for cryptocurrency is popular way for to generate revenue using the computing power and specialist mining hardware. There are many ways to do this, and this article will focus on the PPLNS payment method that is offered by some mining pools.

PPLNS Payment Method

Although there are many solo miners that work on their own, there is growing trend to join pools, where miners combine their resources and computing power to increase the number of transactions that can be completed in a given period, resulting in more income.

As the pools gain more popularity, the amount of resources needed by solo miners to compete increases and this becomes expensive and the ability to compete for transactions more difficult. When miner’s work alone, the calculation of the split of the coins earned for a transaction completed is simple, they get 100%.

However when a pool of miners (more than one) has contributed to the calculation, the income generated needs to be split amongst all those involved.  The two most popular forms of revenue division are PPS and PPLNS.

What does PPLNS stand for?

PPLNS is an acronym for “Pay Per Last N Shares” which calculates your average contribution over a period of time. This ensures that miners loyal to specific pool will earn on average more than miners that hop from pool to pool.

There is an element of luck involved with the PPLNS payment method as the amount of contributors in a pool can fluctuate over a period of time, but in general PPLNS payments will be about 5% higher than PPS payments for the same amount of transactions completed.



PPLNS vs. RBPPS

PPS stands for “Pay-per-Share” which simply calculates the percentage due to each miner based on his or her share of contributed resources to the completed transaction. This is a simple calculation that can be easily forecasted and measured and pays for every share submitted. RBPPS stands for “Round Based Pay per Share” which is very similar to the PPS payment method, but will not pay for orphaned blocks (blocks that are valid but do not belong to the main chain).

PPLNS Mining Pools

When joining a mining pool it is important that miners know what payment method the pool is using and that it meets their execrations and matches their mining activity.

Most mining pools use the PPS method to calculate payment but Ethereum mining pools that use the PPLNS method include:

  • Ethermine, the largest PPLNS Ethereum mining pool with over seventy-four thousand active miners.

  • Ethfans, the largest Chinese speaking Ethereum mining pool, based in Asia
  • Antpool, which pays on the PPNLS, PPS and Solo method and allows miners to mines for Etheruem, Bitcon and other cryptocurrencies

  • Nanopool also mines for multiple cryptocurrencies with servers based across Europe and Asia and just over 50 000 active miners. See our recent article on Nanopool vs Ethpool.

Payout schemes are one of the main considerations when weighting up different pools like Ethpool vs. EtherMine.

For miners that wish to stay with a specific mining pool and are looking for bigger payouts over a long term period, pools that offer PPLNS are a better choice than those that pay on the PPS or RBPPS method. The risk with PPLNS is that your payments could fluctuate by more that 30% over the short period (up or down), but in the long run you will do better.

Ethereum Explained

Ethereum is a recently launched cryptocurrency platform (only two years old) that is quite literally giving Bitcoin a run for it’s money. 

If you’re looking to find ethereum explained in simple terms, you’re in the right place.

What is Ethereum ?

Built on Ethereum Blockchain Technology, it enables a decentralised network of computers to exchange cryptocoins while recording and maintaining the entire history of the transaction. This ensures a cost effective, highly reliable environment that has no single point of failure.

The founder of Ethereum ,Vitalik Buterin, developed the blockchain technology to enable functionality that Bitcoin does not offer such as crowdfunding and smart-contracts, taking the possibilities of cryptocurrency into new realms in the commercial world.

There are many online videos that can assist in understanding the fundamentals of the Ethereum such as:

 

And:

Although the core function of Ethereum is the exchange of cryptocoins, known as Ether, the bigger potential value lies in the smart-contract technology and its possible application across a variety of industries.  Smart contacts allow for the same transactions that happen in the real world to take place in an online cloud environment using a decentralised public blockchain, where the terms and conditions of the contract are measured and on execution, the smart contract pays out.

The contacts are stored, tracked and executed cryptographically. The attached infographic outlines in a simple format the potential uses of Ethereum. http://decentral.ca/wp-content/uploads/2016/03/infographic.jpg.

The range of smart contract applications that people are investigating today is varied and exciting.

Ethereum Explained – How does it work?

The fundamental principle behind Ethereum is a system that is completely decentralised, creating what has been referred to as a World computer. Instead of a single server holding information, it resides with thousands of volunteers computers or nodes.

When the Ethereum program is used, thousand of nodes process the transaction and validate the new state of the contract. This process of validating the  transaction is known as mining. The state of the contract is then updated and the terms of the contract executed upon as written by the original developer or creator of the smart contract.

More information on how Ethereum works can be found on https://www.youtube.com/watch?v=lVcgl8t9LIQ and https://www.genesis-mining.com/what-is-ethereum.

Ethereum mining explained

So we know the process of validating the transaction is know as mining, but how does mining work and why would it be viable for people to volunteer?

In order for the transaction to be validated, computer resources are required that will calculate the transaction.  Miners offer or volunteer their resources to create a block of valid transactions. Miners across the world compete to calculate and validate blocks first and submit their proof that the block is valid, known as proof of work.  When a miner is first to validate a new block he earns Ether which holds value as a cryptocurrency.  The more resources a miner has, the better chance he has of validating and creating a block and earning the coins. This has led to the creation of ethereum mining pools where miners combine their resources to validate blocks faster.

Two of the leading pools are Ethpool and Ethermine, through there are several others that are considered among the best ethereum mining pools.

Mining requires dedicated hardware, or rigs, which can be very expensive to purchase and run.

An online calculator for miners can be accessed at https://www.cryptocompare.com/mining/calculator/eth?HashingPower=20&HashingUnit=MH%2Fs&PowerConsumption=140&CostPerkWh=0.12.

The potential application  for Ethereum smart contracts going forward is almost limitless with significant possibilities in particular in the banking and properly markets when management of contracts is labour intensive, slow and vulnerable to human error.

Ethpool Payout Scheme

Many people have been asking for more information about the payout schemes for various Ethereum mining pools.

For example, what are the pros and cons of pps+ vs PPLNS.

In this article we’ll look specifically at the Ethpool Payout Scheme and point you in the direction of other resources where you can get more info.

EthPool Payout Scheme

EthpoolEthPool.org is slightly different to other mining pools in that it is more like solo mining and therefore doesn’t use the PPS / PPLNS / PROP methodology that some others do.

The Terms of Payment for the site states that:

“http://ethpool.org is a predictable Ethereum solo mining pool and implements a solo mining payout scheme. Each submitted share will increase the credits of the Miner who submitted the share by the fixed share difficulty of the pool. The Miner who accumulated the most credits will receive the reward of the next block that has been mined by the pool and his credits will be reset to his current credits minus the credits of the runner up Miner. “Uncles” are distributed in a similar way only that the credits of the Miner receiving the uncle reward will not be reset.”

This also clearly sets out the pool fees, which for EthPool is 1%.

EthPool also offers a support portal that covers many other specific questions relating to payment methods, frequency of payments etc.

This page explains further that the pool operates with a solo mining payment scheme.

“This means the miner who contributed the most work to the pool will receive the full reward of the next found block (or uncle) and his work account (credits) will be reset to his current credits minus the credits of the runner up miner.”

The site has a couple of useful features that will allow you to work out when you’ll be paid, including “time to next block”, on the balance page.

Top Ethereum mining pools

We’ve looked previously at ethermine vs ethpool.

And there is some debate around which pools offers the greater payout. Many suspect that Ethermine is better for smaller miners, while ethpool benefits much larger mining operations.

Large outfits are making it more difficult for smaller miners to compete on the pool, increasing the time it takes to get paid. As a result, several miners have switched to other pools like Nanopool.

See our other article on top ethereum pools in 2017 here.

Final thought

Here is a useful run through of the payment methods for most of the top pools, including the ethpool payout scheme.

Finding the right pool is really important, and it is definitely worth taking some time to investigate your options. Have a play around with the mining calculators as well.

The differences in picking the right pool can be substantial, beyond just the processing fees. You also have to consider things like opportunity cost, if you’re tied into a pool that is taking a long time, but you can’t leave as you are awaiting payment, that is time lost that could have been much better spent in another pool.

Trezor vs Ledger Nano S

Trezor vs Ledger Nano SHardware wallets are physical devices for storing cryptocurrencies and tokens in a safer and more secure environment than the traditional software wallets.  Where software wallets are often developed in open-source and generally more susceptible to hacking and theft, a hardware wallet is isolated from the Internet and has to be attached to your computer for the codes to be accessed, rendering your tokens more secure.

To date there have been no reported thefts of tokens or coins from a hardware wallet, however even hardware wallets do have their vulnerabilities.

The cost of a hardware wallet is higher than that of a software wallet and with the small returns many miners are seeing, the cost of the hardware wallet might not be easy to justify.

If you’ve invested in an ethereum rig, or cloud mining service, you definitely need a safe place to store your ether and an Ethereum hardware wallet is definitely a good bet.

Trezor vs Ledger Nano S

Trezor

Trezor was first to market with a hardware wallet for cryptocurrencies in August 2014. Each Trezor wallet has a unique passcode that prevents anyone from accessing your transactions should your wallet be stolen and in cases where you Trezor is lost or stolen; you can recover your tokens by accessing the wallet with this passcode. Trezor works with a long list of client wallets such as ArcBit, Chrome Extension, Electrum, Sentinel and Etherwall. Trezor is fully supported on Windows 7 and higher, OSX and Linux platforms as well as being compatible with most Android devices which have a USB on-the –go.

Trezor safely stores tokens for Bitcoin, Litecoin, Dash, Zcash, Ethereum, Namecoin and Dogecoin.

Trezor is a small device, about the size of a key, with a screen, which connects to your computer via a USB cable.

Trezor is slightly more expensive than some of the other hardware wallets available.

Ledger Nano S

The Ledger Nano is a slightly less expensive hardware wallet option comparative to the Trezor but offers a similar level of advanced security versus a software wallet, however it does not offer passpharse support.

A passphrase is an additional text the user creates when setting up the account, which is required when the wallet needs to be recovered, thereby adding another layer of verification.  The Nano S requires the user to set up a PIN code that keeps device secure and after three failed attempts to enter the correct PIN code, the device will not be accessible.

The Ledger Nano S is very easy to setup can be done without needing to connect the device to a computer. The Open Bitcoin Privacy project voted Ledger wallets as the most private wallets available in their report in 2016.

The Ledger Nano S works with Bitcoin, Ethereum as well as Altcoins and is compatible with a variety of Cryptocurrency wallets.

You can find the ledger nano s for sale on sites such as Amazon.com or direct from the manufacturer.

Final Thoughts

Both the Trezor and Ledger Nano S have built in screens, which is advisable largely due to the increased security offered. Hardware wallets with a screen will display the generated password on the screen of the device, while wallets that do not have a screen will send the passcode to your phone.

As your phone is accessible via the Internet it does put the security of the passcode at risk. The screen also adds an additional level of verification when you are making payments.

If you’re interested in a hardware wallet you should also consider the ledger nano s vs keepkey.

For more info check out this useful video:

 

 

Ethpool vs Ethermine

The costs of mining Ether can be very high, with electricity costs and the cost of setting up a mining rig that can process at the speed required.

As the rewards of mining can be slow and intermittent, many miners choose to combine their hardware resources and create an ethereum mining pool, increasing the speed at which blocks are processed and the profits paid out.

This post will focus on the two main pools, Ethpool vs Ethermine. For information on other pools, see our post on the top ethereum mining pools.

Miners then share the rewards of the payout on proof of work. Ethereum is the fastest growing cryptocurrency, more than 2000% since its launch, in the market and Ethereum miner’s work for tokens called “Ether”.

Payments to the miners can work on different principles and calculations, depending on the type of pool they have joined.

Ethpool vs Ethermine

Two of the biggest Ethereum mining pools are Ethpool and Ethermine, which run on the same platform and have combined process of more than 25% of the total network hashpower. However the manner in which the pools run, and the risks and rewards are quite different. Both pools run on a global network with servers based the United States, Europe and Singapore, which are fully redundant and run 24/7.

Ethpool

Ethpool is a predictable solo mining pool and 100% of the proceeds are paid to the miner that contributed the most work. By using Ethpool you get the advantages of pooled mining with a solo mining payment scheme.

Ethpool offer miners the ability to mine anonymously and supports all types of Ethereum miners. Full support is offered to miners, including those using Stratum protocol. There is a big reduction in variance so miners earn their payment as soon as their work is equal to the difficulty of the block. The site includes online mining statistics and can help you estimate your earnings, when used with a calculator. The pool fee is currently 1%. Ethpool offers e-mail monitoring of your work in progress and e-mail notification of found blocks.  Ethpool has about 12,500 active workers and processes about 5 blocks an hour. Uncles (blocks that are almost correct) are paid on top of full block rewards.

Ethermine

Ethermine works on the PPLNS (Pay Per Last N Shares) payout scheme, which includes a luck factor in the calculation of the payment and favours loyal pool clients versus those that jump from pool to pool.

As with Ethpool, full Stratum support is available and payments are made instantly with the minimum payout being a single Ether. The pool fee for participation is also 1%. Ethermine promises all miners accurate hashtag reporting and low costs due to the efficiency of the mining rigs.

E-mail reporting and tracking is available on Ethermine as well as notifications of invalid shares and detailed per-worker and global statistics. Ethermine has more than 200,000 active workers and process about 35 blocks an hour.

Cloud Mining

As an alternative to Ethereum pool mining, a miner can use Ethereum Cloud mining, where instead of providing a Ethereum rig and combining resources, an organisation that specializes in cloud mining will do the mining on the miners behalf for a fee and then pays a percentage of the profit made.

Other Mining Pools

Although these are regarded as the two main ETH mining pools, there are other pools available, particularly a few multi currency pools. Check out our article on Nanopool vs. Ethpool to see how these two stack up.

 

Ethereum Hardware Wallet: The Most Secure Way to Store Ether

Ethereum is one of the most popular blockchain platforms of 2017. Released in 2015, the Ethereum platform features smart contracts and lightning fast transactions. The token used to run the Ethereum platform is called Ether.

For the purpose of this article, we are going to use Ethereum and Ether interchangeably. Like Bitcoin, Ethereum uses a public and private key system. The public key being similar to an email address and the private key being similar to your password.

The holder of Ethereum is responsible for protecting their private keys.

Mining hardware is incredibly expensive and it is foolish to store mining profits on exploitable software and hardware. It was recently discovered that the Jaxx software wallet stored private keys unencrypted.

Ethereum Hardware Wallet

One of the oldest and most secure ways of securing cryptocurrency is by using paper wallets. The problem with paper wallets, is that a lot can go wrong when creating them. For example, a paper wallet created on a computer connected to the internet is technically a hot wallet.

This is because paper wallets make the private key visible. There is no way to know who may be snooping around your computer while it is connected to the Internet.

The better option is to use a hardware wallet. The two most popular Ethereum hardware wallets are the Ledger Nano S and the Trezor.

These wallets function as external USB drives that store your private keys and encrypt them using a mnemonic backup phrase. This makes storing and securing your Ethereum user friendly. Because even if you lose the hardware wallet, you can always restore your Ethereum using the mnemonic backup phrase.

A mnemonic backup phrase is usually a list of easy to remember words that can be stored in multiple locations.

The Ledger Nano S is the easiest to use, of the two, because it features it’s own Chrome app. The downside is that delivery has been slow.

Trezor, the oldest of the two, secures your private keys using the open source website MyEtherWallet. There is a bit of a learning curb connecting MyEtherWallet with Trezor, but the upside is that Trezor is a solid Bitcoin hardware wallet as well. The Ledger Nano S can be configured with MyEtherWallet as well.

Trezor has been around a long time and during the Bitfinex hack, it was joked that it could have been prevented by using a Trezor hardware wallet. No matter which hardware wallet you choose, both are going to be better than storing your coins on an exchange, your computer or your phone.

For more information, see our full article on trezor vs Ledger Nano S

How does one become a holder of Ethereum?

A person can convert fiat to Bitcoin and buy Ethereum with Bitcoin via an exchange. A popular option is a company called Coinbase. Alternatively they can mine Ether themselves with using ethereum mining hardware, or an ethereum cloud mining service.

An upside of building an Ethereum rig is that it can be configured to mine other cryptocurrency as well. If you’ve built your own rig you need to decide whether you want to mine on your own, or collaborate with others as part of an ethereum mining pool.

Using an ethereum mining calculator, one can determine exactly how profitable your mining will be.

Altcoin Wallets

A popular method of storing cryptocurrency online is in a software wallet. Check out our full article on finding the best altcoin wallet for more info.

Ethereum Mining Hardware

Ethereum Mining Hardware

Ethereum was launched in 2015 and has been hailed by the Telegraph as the “rising star of the cryptocurrency world”.

Since the launch of the currency, it has grown in value by more than 2300% and is the second most used cryptocurrency after Bitcoin. The advantage of Ethereum over Bitcoin is that the technology allows for not just currency to be traded on the platform, but also applications.

As with other cryptocurrencies, you can purchase them through an exchange, but you can also mine them yourselves using specialist Ethereum Mining Hardware.

Ethereum Mining

Miners of Ethereum will work to earn “Ether” as a crypto token instead of earning bitcoins. Ether can be used for trading as a currency as well as for payment of transaction fees on the Ethereum network.

Using the correct mining hardware will help you save costs when mining for Ethereum, however before you purchase mining hardware it is important that you have an ethereum hardware wallet to safely store your coins. Consider the Trezor vs Ledger Nano S wallets.

Ethereum Mining Hardware

In order to mine Ethereum, you will need a computer with a GPU (instead of a standard CPU).

The better the GPU, or graphics-processing unit, the faster the hashing power of the computer, which equates to more calculations possible per second.

It is important however to take the cost of electricity into account when purchasing a GPU.

The more powerful the GPU, the higher the electricity consumption will be.  To calculate the estimated costs more accurately, find an Ethereum mining calculator and enter the numbers relevant to your requirements, investments and electricity costs.

Hardware can be purchased at different capacities from $200 upwards.  The Raedon R9 295×2 is said to have the highest hash rate of all Ethereum rigs and so will give you the biggest returns on money.

Ethereum mining rigs can be dedicated to Ethereum mining only or can be a computer that performs any other necessary tasks and does mining on the side.

Should the price of a mining rig be beyond your budget, it is also possible to build your own Ethereum rig from basic computer parts. You will need GPU’s, graphics cards, motherboards, and power supply units. Each GPU will need about 200 watts of power. For more information on building your own rig, click here.

Ethereum mining is said to be resistant to application-specific integrated circuit (ASIC) as Ethereum contracts can include any type of computation and therefore ASIC’s would not add any benefit to Ethereum mining.

Ethereum Cloud Mining

Ethereum Cloud Mining

Ethereum Cloud mining is a good alternative for potential miners that do not want the expense and maintenance of owning their own hardware. By signing a contract with a company that does cloud mining and depositing your money, you can be active as a miner almost immediately.

It is important to ensure the company you contract with is reputable and will not disappear with your money. Large cloud mining companies can keep their costs down due to the large volume of hardware and data they purchase and can therefore pass better earnings over to you.

Of course the downside to cloud mining is that you will be paying a percentage of the profit over to the company managing the hardware and mining in your behalf.

Mining Pools

If you’ve already made the investment in hardware, you could join an Ethereum mining pool online to help share resources.

See our comparison of Ethpool vs Ethermine here or read more about the top ethereum mining pools

Ethereum Investing

Mining is not the only way to invest in Ethereum.

You might be wondering “where can I buy Ether?”.

You can purchase a wallet and buy Ethereum through an online cryptocurrency exchange. Selected broker has a breakdown of the best Ethereum brokers online to assist you. This is of course a far less time consuming manner to invest, however the risks are greater as the currency is fluid and volatile.

Ethereum has made a significant impact on the cryptocurrency market and is considered to be a better investment than Bitcoin.

Ethereum Mining Calculator

There is growing interest in Ethereum Mining.

Ethereum Mining Calculator

And it is quite natural that every Ethereum Miner is interested in increasing the return and profitability of their efforts. An Ethereum mining calculator is an essential tool that will help you work this out.

Ethereum Profitability

Rather than purely focusing all efforts on your Ethereum RigEthereum Cloud Mining Services or other hardware elements, it is important to think about all the other metrics that will impact earnings in both Ethers (ETH)  and Dollars ($ / £ / €).

Of course no Ethereum Miner is interested in losing the value of the investment and efforts. In a given duration, say a day, week, month or years what are the estimated earning and profit is of paramount concern.

Ethereum Mining Calculator

We have already seen that there are quite a lot of variables in Ethereum Mining that can contribute or affect Ethereum profitability.

Over time Ethereum Mining difficulty is increasing as is the case with other cryptocurrencies. Mind here that the Ether conversion rate or vale of Ether is growing sometimes exponentially.

The Ethereum Mining Calculator and Profitability Calculator is used to know what we can expect to get with what we plan to do and if we alter the metrics what we can expect to get from Ethereum Mining.

So, it is most essential tool and calculation that every Ethereum Miner MUST have knowledge and details. Fix your goals, know what you are current metrics are, know how alterations can affect your profitability. All with Ethereum Mining Calculator.



Ethereum Mining Online Calculators

There are some online Ethereum Mining Calculators available which the miners can make use of readily. Also, when miners are going in for Ethereum Cloud Mining services, the service itself can be of help in providing quick information.

The following are some indicative Ethereum Mining Calculators to have a look at.

Ethereum Mining Hash Rate

Ethereum Miners can work as solo miner or in an ethereum mining pool. While working in a pool, there may be a pool fees and pool efficiency also matters in profitability.

See our comparison of mining pools Ethpool vs Ethermine

The key metric in calculation is mining power or hash rate. How powerful mining operation or how powerful our Ethereum rig can be, is all known by the main metric Hash Rate. A hash or hash rate is the output of a hash function which is the speed at which a compute is completing an operation.

As similar to computing processor clock cycles, hash rates also go as:

  • 1 MH/s = 1,000 kH/s
  • 1 GH/s = 1,000 MH/s
  • 1 TH/s = 1,000 GH/s

Ethereum Mining Difficulty, TH

There are simple Ethereum Mining Calculators to advanced Ethereum Mining Calculators; depending on how many metrics they take it as inputs and how many inputs they assume as average given figure.

A simple Ethereum Mining calculator takes in to Hash Rate input assumes all other metrics including electric power consumption and rate and calculates ethers and dollar value.

An advanced calculator may take into more metrics than electric power in watts, power cost in kilowatt per hour, ethereum mining hardware cost, adding to block time, difficulty factor, network hash rate, exchange rate etc.,

As mentioned Ethereum Mining difficulty is increasing and can be seen in this page; or here.

Difficulty is usually expressed in TH unit and refers to the probability of finding the hash.

Final Thoughts

To make any money it is imperative that your mining is done as efficiently as possible.

Ethereum Mining Calculators come in handy as a compass to set the right direction and navigate our way towards mining profitability.

Ethereum Cloud Mining

For those interested in mining ether, but don’t have the technical expertise to get set up with their own hardware, ethereum cloud mining could be the perfect option. 

Ethereum Mining Options

If you’ve looked into mining your own crytocurrency, you may well have considered building or buying an ethereum rig.

You’ll also know that the task in hand required very high computing power! And whether it is buying a rig or building one, it involves capital investment upfront and of course some time and efforts. Not to take into account the nitty gritty of hardware, software installation, integrations, and making it all work together for the whole time.

Fortunately there is another option…

Ethereum Cloud Mining Services

Just before diving in, let us also consider another option, Ethereum Cloud Mining and its details in brief. Of course as any other one, this option also goes with its own pros and cons.

In the age of everything available as a service, there are dedicated cloud mining services too. And that services presents itself a really serious and attractive option.

Cloud Computing

Computing power has been available as a service for quite some time now, including Infrastructure As A Service (IaaS), Software As A Service (SaaS) and Platform As A Service (PaaS).

Software Applications are also bundled with these services and made available readily to everyone who want to start anything. In recent times it is a real success that it is considered even before opting for owning the equipment.

A decade back it all started as an innovative alternate option but now cloud computing is the first option. Examples of globally leading services are AWS – Amazon Web Services, Microsoft Azure, Google Cloud, IBM Cloud etc.,

It is quite natural that cloud mining services also emerged quickly and being adapted. There are some distinctive advantages of cloud computing which leads to its success and adaption.

Ethereum mining pools

If you’ve already invested in ethereum mining hardware but would like to find a more collaborative way to mine for ether, you could consider joining an ethereum mining pool.

Ethereum Cloud Mining Benefits

When considering Ethereum Cloud Mining Services, on the one side this job being one that requires costly computing power and on the other side there some service providers emerging as attractive services – well these make it more attractive and tend to push towards the solution.

All one need to do is sign up for a service and start doing the work of mining Ethers. An Ethereum Miner starts the work of mining without having to worry too much about Ethereum Rig, Ethereum ASIC, Ethereum Hardware, the hassle maintaining the hardware/software etc.,

These services seems to be solving some more issues like:

  • efficient cooling,
  • technology upgrades
  • more statistics,
  • better pool allocation etc.,

Not to add the benefits of easy realization of rewards, trading options etc.,. It should be mentioned that Ethereum is moving to PoS (Proof of Stake) from PoW (Proof of Work) and some of the old rigs built used for mining may become unusable for this purpose.

Leading Ethereum Cloud Mining Services

There so many Ethereum Cloud Mining services available now. We will discuss only market leading or emerging innovative service providers.

It should be mentioned that some Ethereum Miners are also using leading mainstream cloud computing services like AWS, buying the computing instances from them and setting up mining rigs.

And there are pure play cloud mining services. These pure play cloud mining services are the easiest way to get started and so being discussed here in this article. Service offering features may vary between different service providers and miners experience may also vary as mining is a complex process that not only depend on the rig but also with some external factors.

Some of the service providers include:

  • Genesis Mining
  • HashFlare
  • HashMining

At this point as an extra cautionary alert, we can site some of the disadvantageous as these

  • recurring fees service may be higher operational cost reducing the profitability
  • and some scam and default of pay-out risks by service providers.

It should be a general advice to new miners to go for established, trusted service in the market.

Ethereum Cloud Mining – Distinctive Advantages

Keeping aside the CAPEX (capital expenses) and OPEX (operational expenses) part let us look at what are the distinctive advantages that Ethereum Cloud Mining services presents.

One as we have already seen is instant start-up. We can sign up and start. Go for a contract offering period that is suitable to us.

Since Ethereum Mining is a hardware computing power intensive activity, cloud service provides flexible options for choosing and scaling the mining activities. When buying and owning we cannot expect or get this flexibility. Cloud mining service providers’ servers are usually kept in high standard datacenters that have:

  • better network connections
  • cooling power
  • power efficiency
  • security standards

And service goes with service level agreements and guaranteed uptime. Plus there is 24/7 customer service to get technical issues sorted out or support for mining service issues.

Ethereum Cloud Mining Contracts

Cloud mining contracts offered by cloud mining companies like Genesis go as small, medium and large. Small contracts start with 1 Mh/s, Medium at 25 Mh/s and Large at 100 Mh/s and you can note current rates and pay-out in Genesis site. Fixed hash rate contract for fixed duration is easy to start-with. Cloud Mining Services definitely offer attractive benefits to consider and get started with Ethereum Mining.

An ethereum mining calculator will help you assess how profitable your approach will be, which will in turn influence your choice of hardware.

Once you have mined your ether, you may want to invest in an ethereum hardware wallet as a secure way to store your currency.

 

Ethereum Mining Pool – What is it and should you use one?

Once you have established yourself as an ethereum miner and have purchased all the necessary equipment to build a suitable ethereum rig, you need to determine if you wish to remain a solo miner or become a part of an ethereum mining pool.

Each of these options has benefits and consequences and is dependent on your personal requirements and to some degree on the processing power of your ethereum mining hardware.

What is an ethereum mining pool?

A mining pool is when a group of solo ethereum miners join forces and combine their processing power for quicker mining results. The shared processing power helps to solve blocks faster and miners can see results quicker than when they mine solo. Each of the contributing miners is paid a share of the block based on their contribution.

The hashrate of the rig is determined by the processing power, so the increased resource of pooled ethereum rigs will result in more blocks generated in a shorter period of time.

Ethereum mining pools calculate payouts on different methods.  A PPLNS payment basis, (Pay Per Last “N” Shares) involves some luck but offers on average 5% more than PPS (Pay Per Share) where you get a standard payout for each share completed.

Some pools also run on a predictable solo mining method where the person who contributed the most to the block gets the whole block.

It is important not to confuse ethereum mining pools with ethereum cloud mining. With cloud mining an organisation will own the rigs and do the mining on your behalf and pay you dividends, for mining pool each miner needs to own their own equipment and have software that enables them to join a pool and then earn a share of the blocks mined.

Best ethereum mining pool 2017

The top ethereum mining pool for 2017 is reported to be the joint mining pool of Ethpool and Ethermine. The two have separate sites and different payment methods (PPLNS and predictable solo) but the underlying pool is shared and currently makes up just over 25% of the hashrate network.

Ethermine has over 63000 active miners and Ethpool 1200. Combined they mine over 50 blocks per hour.

F2Pool, also known as Discus Fish, (contributing 21.6% of the hashrate) is based in Asia and Dwarfpool, with servers in Canada and France,  (13.3% hashrate) are in second and third place respectively

A single mining pool should never exceed 50% of the hashrate network.

Read more about Ethpool vs Ethermine or see our full post on the top ethereum mining pools

Ethereum Mining Pool vs Solo Mining

As with any option there are positive and negatives for choosing to join a mining pool versus mining solo. When mining solo you do not need to share your rewards with anyone but the chances of earning are significantly reduced and the time from investment to reward can be far longer.

The more mining pools in play, the more hashrate of the network the pools are using and the more difficult it becomes for solo miners to get blocks.

Solo mining is not recommended unless you have processing power over 100mhz.

To calculate the mining profits expected, use the ethereum mining calculator.

Choosing a mining pool

The most important factor in choosing a pool is the reliability of the pool and their reputation for paying correctly. The bigger pools would not have been successful if they did not meet the criteria of their miners so it is always safer to go with the well known.

However there are many ethereum pools available and the payout rates are different, so you may find it more profitable to choose a smaller pool and take the risk.

You should also consider investing in an ethereum hardware wallet as a safe place to store your ether.