With the explosion in cryptocurrency mining, new miners often forget one of the most important parts outside of building a miner is to choose the right mining pool. This is important to not only maximize your profits but also to avoid getting scammed. There are 5 key things you need to look at before you connect your rig to any mining pool.
5 Important Points in Choosing a Mining Pool
Once you have your mining rig built, hopefully by using our guide to building a mining rig, and you have decided on a coin to mine, you need to choose the pool that best fits your mining philosophy. In order to do this, you should consider the following five points (The order of these can be user preference but all should be considered.)
Mining Pool Reputation
Reputation is one of the few things that can cause a pool to grow rapidly or crash and burn. The cryptocurrency world is flooded with scams, and mining pools are becoming another area you need to tread lightly, especially with new or small pools.
If a pool has a large number of miners and has been known to have consistent uptime with minimal issues you are likely mining on a reputable pool. One way to check the history of a pool is to look over at the Bitcointalk Altcoin Pool section. Run a search on the pool name and see if there are any reviews of the pool. You can likely weed out small bad pools this way.
Mining Pool Profitability
This can be tricky to determine the pools profitability. A larger pool is likely to hit more blocks and thus you will be able to get paid out quickly and more consistently. A smaller pool will hit fewer blocks overall and depending on the pool’s payout method, you could be paid out less frequently but receive a larger amount per payout. In theory, if you mine on these pools long term and don’t pool jump the earnings should normalize over time. It depends on miner preference and how the pools payout if you like to jump pools or change often you should likely look for a larger pool.
Mining Pool User Interface
Another thing that is important is how easy the pool is to set up. Once setup is the pool’s dashboard easy to understand? Does it display your hashrate clearly along with all other pool statistics? Another very important part of the interface is what the payout frequency is and the minimum you need to mine before you will be paid. This is important because depending on your hashrate it may take you a long time to reach a payout. This could be a dealbreaker for some who want to get paid out in small amounts frequently. This also could be an indicator of a scam on smaller pools who change the minimum without warning and eventually disappear with your coins.
Mining Pool Tech Support
Tech support is very important because when you have issues you want resolutions quickly. Downtime on your rig from pool errors can add up over time to missed profits, especially if you are mining a new coin. Smaller pools often times have quick responsive feedback as they are trying to grow and the fastest way to build a great reputation is having a fast pool with low fees and great customer service.
Larger pools often times do not have quick customer service due to a large number of questions they get asked, but usually will have a good FAQ or guide for common issues. Always look at the getting started guides to ensure you read all the info for the pool to help you get up and running quickly.
Mining Pool Fees
This goes hand and hand with profitability. Always look at the fees pools are charging to use their pool. Smaller pools may offer 0% fees for a period of time to try and grow their pool quickly. This is a great way to help increase your profitability, but be careful to ensure that the pool is reliable and is not a scam to try and get you to mine and take your money.
You also need to look at if there are any transaction fees for converting coins if you are using an algorithm switching pool, or any additional fees for sending to your wallet. Never keep your balance on a pool if you can avoid it. You never know when a pool will close and if they do your coins are gone with it.
There are thousands of mining pools out there with more coming online every single day. The above information is critical for every miner to understand to not only protect yourself from potentially losing out income, but also increase your knowledge of mining pools in general.
This guest post was written by Zac over at The Miner Hub. His website has a heavy focus on helping new cryptocurrency miners get started and information on the latest GPU minable coins. Take a look at his blog for more information on common cryptocurrency mining questions and answers.