What is pool hopping

Individual miners join mining pools to benefit from a more predictable income. Many questions remain open regarding how mining pools have evolved throughout Bitcoin's history and when and why miners join or leave mining pools.

We propose a heuristic algorithm to extract the payout flow from mining pools and detect the pools' migration of miners. Our results showed that payout schemes and pool fees influence miners' decisions to join, change, or exit from a mining pool, thus affecting the dynamics of mining pool market shares.

Our analysis provides evidence that mining activity becomes an industry as miners' decisions follow classical economic rationale. Document type : Conference papers. Complete list of metadata Display. Files produced by the author s. The gain that can be achieved by following this strategy is up to The gain can be higher if more than one proportional pool is taken advantage of for example, The extra profits of hoppers come at the expense of the continuous miners.

The exact loss depends on the ratio between hoppers and continuous miners; when they are equal the loss is about Slush's method, which scores shares based on the time they are submitted, was designed to combat pool-hopping, but is only an incomplete solution.

SMPPS which strives to converge to the full value of each share in the long run can only be hopped to minimize the time until being paid in full, not to increase the expected reward. Modern methods make sure that the reward per share depends only on the future of the pool, not its past.

This way, without being able to divine future random events, any time is as good as any other to mine, so there can never be any gain or loss from hopping with the exception of block-withholding attacks. Advanced forms of pool-hopping, possible in some naive reward method implementations, include difficulty retarget hopping, tx fee hopping and hashrate fluctuation hopping.

Pool hopping is a mechanism by which certain miners may exploit the payment mechanisms of pools to dramatically increase personal profits. Unfortunately this creates an imbalance wherein blocks solved in less than average time are worth more per share than blocks that took average times or longer to solve. This makes proportional pay systems inherently exploitable.

To simplify the concept, imagine you're at the world's strangest casino. The only game in the house is rock-paper-scissors and you're playing against the other patrons. If you win the first game after you sit down at a table, they pay you 10 times your bet. The second game pays 9 times, the third pays 8 and so on until eventually you're not even earning your bet back. It seems obvious that the optimal strategy is to hop from table to table taking advantage of the 10x payout rule as many times as possible without every hitting diminishing returns.

Pool hopping is much the same. After this point, your shares aren't worth any more than average and it becomes more profitable to hop to another pool with fewer shares. The effect of pool hopping on the other users of the pool comes from a shift in one factor of mining without a corresponding shift in the other: time vs.

Without hoppers, the value of shares in a proportional pool differs with time - shares submitted early in a round are worth a great deal more than those submitted later, but as long as hoppers are not present, the value of shares average out to a fair value.

While hoppers do not change the average number of shares per block or the number of shares an honest miner submits, they do decrease the duration of the higher-paying portions of a round. With the most profitable portion of the round taking significantly less time to complete than the remainder, a miner submitting shares at a constant rate will have far more shares on average in the less profitable parts of a round than in the most profitable, thereby reducing their overall average share value.

The more hoppers are present, the shorter the profitable span becomes and therefore the more dramatic the effect. Preventing pool-hopping is simple: When creating a pool, simply choose an algorithm for funds distribution that has been proven immune or even hostile to hopping - i. When choosing a pool to mine in, one should similarly choose a pool which has chosen a fair payment schema. My first answer only refers to the " how do pool hoppers affect other miners? The loss to full time miners at a standard proportional reward pool can be calculated as:.

If you're a miner, mine at a pool using one of the above reward methods. Either that or mine solo. Sign up to join this community. The best answers are voted up and rise to the top. Stack Overflow for Teams — Collaborate and share knowledge with a private group. Create a free Team What is Teams? Learn more. What is pool hopping? Ask Question. Asked 9 years ago. Active 1 year, 11 months ago. Viewed 26k times. What is pool hopping and how do pool hoppers affect other miners? Are there ways to prevent it?

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