If you’ve decided to mine Ethereum before it switches to proof of stake you’ll need a few things to be successful.
The first is obviously a strong Ethereum mining rig. Assuming you’ve already bought or built a rig for mining Ethereum the next thing you’ll want to do is find an Ethereum mining pool to join.
A mining pool is nothing more than a group of individual miners who have joined forces to help increase their hash power, and to lower the volatility of their payouts. Rather than waiting for a large payout when you successfully mine your own Ethereum block you can join a pool and collect a small part of the entire pools’ Ethereum each day, or more frequently in some cases.
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Mining Pool Criteria
One thing that’s important to look at when choosing a mining pool is the fees charged. You’ll want lower fees to increase your own profits. It’s also good to look at the minimum payout of the mining pool to ensure you won’t be waiting too long between payouts. Finally, it’s important to consider where the mining pool servers are located. The closer your rig is to the pool servers the more efficiently you’ll be able to mine.
Below I’ll go into more depth about four different mining pools and what you can expect from them. Beyond that is a short discussion of what might happen once Ethereum switches from proof of work mining to the hybrid proof of work/proof of stake mechanism expected to be implemented sometime in 2018 with the Casper network upgrade.
If you want a complete list of mining pools to compare for yourself after reading this article you could head over to Investoon.
How to Pick the Best Ethereum Mining Pool
It’s somewhat misleading to say “the best” since the definition of the best will depend on the persons requirements and expectations when looking at Ethereum mining pools. The fact is, it isn’t all that easy to determine the best Ethereum mining pool for you, since they are all quite similar on the surface.
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You’ll soon find that there really is little difference between mining pools, and almost any of them could serve you well. The rewards you will receive will be similar, and the real differences come from the fees charged and the location of the pool servers. You might be able to choose simply based on these two criteria alone.
Your location in regards to the location of the pool servers will play an important role in how quickly and efficiently you’ll be able to mine Ethereum with your rig.
You might find some differences in the details of the mining pool once you’ve joined, such as software configuration, or in the hashrate you’re experiencing, but you have to try and see what your personal results are.
Maybe you read on a forum that mining pool A is great and mining pool B sucks, only to read at a different forum that mining pool B is the best, and everyone should avoid mining pool A.
To at least get you started with the factors that are objective in determining the best Ethereum mining pool I’ve put together a list of five you should definitely consider.
Ethermine and Ethpool are actually the same pool, owned by Bitfly, but they run different payout schemes. Ethermine is the most popular Ethereum mining pool there is, with over 129,000 miners in its global mining network. You’ll find servers located in Asia, Europe and North America, and the network comes with DDOS protection to avoid attacks.
Ethermine uses a PPLNS payout scheme and pays immediately in real-time once you hit your minimum payment threshold. The minimum payout allowed is a low 0.05 ETH, which is great for those who aren’t running high powered rigs. Ethermine does take a 1% fee, but they also pay all mining rewards.
Screenshot from Ethermine.
You can also mine anonymously through Ethermine, and they allow for several different mining software configurations, including Claymore Miner, Ethminer and Phoenix Miner.
One of the things that has attracted so many miners to use Ethermine is the great support they get, along with the highly efficient mining engine.
As for Ethpool, this is a Solo-type mining pool which pays the entire reward to the miner that made the greatest contribution to solving the latest block. Because this is a volatile (but fair) way of mining there are far less pool members (less than 900 as of June 2018).
If you’re interested in solo mining you should read the payout rules before continuing. One interesting feature of Ethpool is that all uncles are paid to a random miner.
Nanopool has just over 85,000 miners, making it the third largest global mining pool according to Investoon. You’ll find the pool fee is the same as at Ethmine, just 1% and that the pool pays all rewards. The default minimum payout at Nanopool is just 0.2 ETH, and you can set it even lower in your settings if you like. It’s a pretty straightforward and easy site to use, so it’s suitable if you’re just getting started with mining Ethereum.
Note that there have been some online reports regarding the hashrate at Nanopool being significantly less than when mining on their own, or even through other pools. That said, the community seems to be quite pleased in general with Nanopool, as evidenced by the large base of miners using the pool.
Dwarfpool used to be among the most popular Ethereum mining pools, but it has fallen out of favor more recently, although I’m not exactly sure why. Still, it remains the fourth largest global mining pool for Ethereum, and has global servers in both North and South America, Europe, Asia and Australia.
Benefits of Dwarfpool
It charges the same 1% fee as the mining pools above, and is considered by some to be the fairest exchange because it has a true round based payment system which is proportional to your shares.
Mining with Dwarfpool is completely anonymous, you don’t even have to register for an account, and they make automated payouts every hour. You are able to find every statistic about mining on their website, and can also monitor every mining rig via automated emails.
I’ve seen some complaints about the default minimum payout at Dwarfpool, which is 1.01 ETH, but these people probably fail to realize that there is a webform that can be submitted to change the minimum payout to as little as 0.05 ETH, or as low as 0.01 as slow autopayout at the end of the queue.
I’m including MiningPoolHub last, but it certainly isn’t least in our consideration. While it began as a small mining pool run by a dedicated group of Ethereum enthusiasts, it has grown to be the second largest global mining pool. Because there are a lot of things to like here.
One of them is the fact that you can also mine roughly three dozen other coins. Another is the charges, which are calculated based on rewards depending on the block finding fee, transaction fee, the bonuses and a few added incentives too.
Like the other global mining pools it has servers in Asia, Europe and North America and a low 0.9% fee. Best of all, the servers in each location are redundant, meaning there’s no need for a backup.
One feature user’s love is the algorithm switching feature that allows you to mine multiple coins of the same algorithm at the same time. People also love the auto-exchange feature that exchanges your mined coins for another coin you specify.
And finally there is an auto algorithm switching feature that will set your account to mine whichever algorithm has the most profitable reward at the time.
If you are a looking to be a professional Ethereum miner, Miningpoolhub might be the perfect Ethereum mining pool for you.
One of the newer mining pools that has just entered the market is 2Miners. Given that they are one of the newer pools, they have a unique and modern user interface design.
2Miners developers have taken into account all the drawbacks of the current mining pools and made their product from scratch. The operation of this pool is completely transparent – all statistics could be viewed and analyzed by anyone.
2Miners have 2 different payout systems: PPLNS and SOLO. This is the only pool with the notification bot available for different messengers.
The pool is really easy-to-use. The “Quick start” option enables the rookie miners to set up their hardware and start mining in a few seconds. 2Miners provides the 24/7 support via helpdesk, social networks and messengers.
In terms of Ethereum Pool fees, it charges the standard rate of 1% on the block rewards. It will be interesting to see how 2Miners grows as miners try to diversify away from established pools.
Post-Casper GPU Mining
Ethereum will be switching to a Proof of Stake consensus mechanism sometime in 2018 and some wonder how this will impact mining. The good news is you can still mine, but the bad news is you’ll have to do it by staking Ethereum, and by all accounts it will need to be a large amount of Ethereum.
You could start mining now, but if you don’t already own the hardware it probably isn’t worth it, although you could go the cloud mining route to accumulate some Ethereum and avoid the hardware costs.
Ethereum Casper PoS
That said, the initial Casper change will be a hybrid Proof of Work and Proof of Stake system, where PoW still mines coins, but every 50th block uses PoS as validation. That is the switch that is coming sometime in 2018, and no one knows for sure when Ethereum will move fully to PoS.
With that being the case, it might be worth it to buy or setup an Ethereum mining rig now, if you believe the price of Ethereum will increase dramatically in the next couple of years, because it will likely be at least that long until Ethereum becomes totally PoS.
One fear that has been circulating revolves around GPU mining in general. There have been estimates that as many as 2.5 million GPUs are being used to mine Ethereum, and if Ethereum mining stops there will be a glut of GPUs that will make mining a profitless task.
What isn’t figured in is that these GPUs will likely be slowing moving away from Ethereum once the hybrid system is implemented. And by the time a full PoS system is in place for Ethereum there will almost certainly be other coins that can be mined, and even other projects that can take advantage of spare GPU computing power.
So, chances are money spent on a GPU mining rig now will hardly be wasted.
If you believe in Ethereum for the long term, then starting a mining rig and joining a mining pool now makes perfect sense. There are plenty of great pools to choose from and even with Ethereum switching to Proof of Stake, it looks as if several years will pass until that transition is completed.
If you choose one of the four Ethereum mining pools listed above you’ll know you’re getting reliability, stability and fair rewards. Plus you’ll have a jump on the move to Proof of Stake in Ethereum.
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