Mining pool

A mining pool is a group of miners who combine their hash power and share the rewards. Because finding a Bitcoin block is a lottery, a small miner working alone might wait years for a win; by pooling, members receive smaller but regular payouts in proportion to the work they contribute.

The pool operator coordinates the work: it builds candidate blocks, sends tasks to members and tracks their "shares", lower-difficulty solutions that prove effort. Payout methods include PPS (pay per share), FPPS (full pay per share, which also shares transaction fees) and PPLNS (pay per last N shares). Pools charge a fee, typically a few percent.

Pools create a centralisation concern: a small number of large pools, including Foundry USA, AntPool and ViaBTC, find most Bitcoin blocks, and the operator usually chooses which transactions go in. Individual miners can switch pools at any time, and protocols such as Stratum V2 aim to let miners select transactions themselves.