Just another Bitcoin Cryptocoins mining pool?

Throughout the years, my experience with Bitcoin and Altcoin (cryptocoins). A typical Mining Pool, such as GHASH.io BTCGuild, and many more, simply a Mining Pool that allow computers or miners equipment such as ASIC to connect and mine the Cryptocoins.

Typical Mining Pool, has many users connected their computers or mining equipment such as ASIC with combined hash rate to mine Cryptocoins. The higher the hash rate, the higher chances of hitting a block to get the Cryptocoins. The Cryptocoins found or generated will be divided evenly to the members or users connected to mine for that duration of time. A simple calculation to get your fair share, based on your combination of hash rate and the time you spent on the pool. The payout normally is immediate to the members. The owner of the pool make money by fees 1-2% of your earning or withdrawal. Pool owner cannot cheat easily because the hash rate and  value of the coins are transparent.

Multipool. These types of pool will mine the most profitable coins every so often it will check the price based on an exchange price. Some multipools have different logic than other, some are robust, some aren’t so robust and required manual intervention from the operator. However the payout is the same as typical mining pool, in term of fair share that is. The owner of the pool again make money by fees 1-2% of your earning or withdrawal. Pool owner cannot cheat easily because the hash rate and  value of the coins are transparent.

Contract Mining. This is complicated, I can’t never really understand how it work, maybe because I haven’t tried yet. From what I’ve observed. Mining Contract have a duration, and price per Hash Rate at the time you have to pay in full, and the hash rate is your. Your hash rate yield your earning, and you should be able to withdraw your earning. So let say you purchased 10gh/s $10. You earn based on that 10gh/s, should be simple as that. Your earning could be 25 cent some time and sometime 1 cent and sometime $1, again simple.

Ming Pool, Contract Mining, and Exchange. Now this is complicated, and I would stay away if you don’t know what you’re doing. Basically a mixture of Mining, then trade your coins to other coins back and forth. Or you can also buy contract, so basically your earning is going in a circle, you try to make more money or more coins based on what you have. Some may succeed, a lot will fail despite the price of Bitcoin up or down, just a lot of poor decision, or bad luck.

SCAMMING – these are the Mining Pool with lots of flavors including a static amount earning set in stone even if the value of Bitcoin Cryptocoins dropped. To me, basically the owner operator willing to a take loss? NOT if they’re loosing they will close and run away. So if they succeed, because Bitcoin value rise skyrocketed they will remain in operation for long time right? WRONG again, they will try to attempt to stay long, but they already have goal and will run away once they reach that goal and seen proper time to exit with all the money they got from investors including Bitcoins and other cryptocoins.

Why a Mining Pool would fail? – a mining would fail when the cost of operating is higher than the amount of money they make from fees, mostly caused by Bitcoin price dropped. So let say the pool have 2% fee, so $10 would be 20 cent profit. Oh but wait! it’s not dollars, it’s actually the value of the Bitcoin or the coins being withdraw or payout. So the 20 cent could be 20 cent for now at the moment, but if Bitcoin value dropped, the 20 cent is no more, it could be 10 cent or less; however if bitcoin rise skyrocketed then 20 cent will be 25 cent or more depend on the value of Bitcoin and how long the operator is holding the coins. So the Mining Pool will fail when the hash rate dropped, and also when Bitcoin value dropped, because the money from fees is not enough to cover for the operating cost. Simple.