Pleb mining question
Are miners (home or having someone host) collecting fees even if you don’t find block reward?
Have the economics changed considerably bc of fee environment?
Appreciate the time🤙
Discussion
Pretty much all mining pools are now some variant of FPPS.
With FPPS you're recieveing rewards as a forward contract on your hash rate. This means the pool guesses at what the average daily fees/income will be and divvy that up bases on your hashrate. This is good for the one lending their has (the pleb miner) when blocks are sporadic or hard to come by as they end up getting slightly more rewards than they otherwise would. In a sudden high fee environment, you're getting screwed because the pool can pocket the extra.
I disagree with this model as it is a derivitives system mirroring bad fiat mind habits.
Braiins used to pay per block and ONLY when a block was mined. But they sold out and went FPPS. Presumably so they can cater to larger industrial mining operations which require steady predictable income to better project future profit/loss.
Thank you
So if fees continue to climb will forward future contracts adjust to more revenue? Or just based on hash lent
To directly answer ur question, If fees continue to stay high and/or climb, the forward rate paid to hash lenders (miners connected to the pool) will increase over time. This is because the calc is almost always based off a trailing average. The rewards hash lenders earn will slowly correct over time but do not tend to adjust immediately. If fees fluctuate quickly, actual hash lender income might not adjust in time, but if fees adjust gradually over time, then yes, hash lender rewards will eventually adjust.
So there's two calcs that happen one after the other to determine payouts. Specific pools each calculate their own way but the general concept is pretty much the same across the major pools.
The first calc that pools do is the average daily income that the pool expects to earn. They calc this based off some sort of trailing average of actual earnings. Either the average daily earnings (block reward + fees). Or monthly prorated or trailing hourly... whatever they deem appropriate. That then creates an available "forward pool" of funds.
The second calc is each individual miner's hashrate over x period divided by the total hashrate for that pool over that same period. Each miner gets a pro-rata share of that forward pool of rewards.
The pool itself takes the lent hashrate and is the one to actually mine. Whatever rewards they get is theirs to keep, regardless if it totals more or less than the forward pool they've promised to hash lenders.
Is someone hosting your hash via one of the larger pools a steady stream of BTC? What’s a ballpark average per month/year … not counting outlay investment?
I know the risk of not self hosting/energy cost but just mainly curious
Thank you for your time🤙
Zaps ⚡️ sent
Only miner (or pool) who found the block collects the fee (and block rewards).
nostr:npub13cnlldwfhwxd6qf34hnwlfya2m2qrd2zfk0alxnrup6d2fasw9wqxwkzpe nailed the pool side. I'd add the economics have changed more from price increase than fees at this point. While more blocks are coming in with substantial fees it's still not the effect that jumping to $40 had on bottom lines.
I would say the fees are more proving that the mining death spiral isn't happening. They aren't changing things substantially yet but are showing that the fee market can be healthy enough as this utilization increases.