EXPLAINER
Mining pool payout schemes explained: PPS, PPLNS and what you actually earn
PPS pays a predictable amount and charges for the certainty. PPLNS pays more on average and hands you the variance. Which suits you depends on your buffer.
Quick answer
PPS pays a fixed amount per share regardless of whether the pool finds blocks, and charges a higher fee for absorbing that risk. PPLNS pays from actual blocks found, so it pays more over time but with real variance.
Pool fee comparisons are close to meaningless without knowing the payout scheme, because the fee is the price of a different product in each case.
PPS — pay per share
The pool pays a fixed amount for every valid share you submit, whether or not the pool finds a block that day. Your income becomes almost perfectly predictable. The pool absorbs all the luck, and charges a higher fee for doing so.
This suits anyone on a thin margin or with no cash buffer, because an unlucky fortnight does not stop you paying the electricity bill.
PPLNS — pay per last N shares
You are paid from blocks the pool actually finds, in proportion to your recent contribution. Over a long enough window this pays more than PPS, because you are not paying someone to carry your variance. Over a short window it can pay considerably less, or occasionally nothing much at all.
PPLNS also penalises pool-hopping by design, which is the point of the “last N shares” window.
FPPS and hybrids
Full pay-per-share adds transaction fee revenue to the PPS base. It is the most common arrangement at large pools now and generally the best default for small miners, but check whether the advertised fee applies to the block subsidy only or to the fee revenue too.
How to compare honestly
Take the fee, the scheme and the payout threshold together, then compare over a period of months. A one per cent difference in fee is small next to an hour of downtime, and both are small next to running an inefficient machine — see the four numbers that actually matter.
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Key takeaways
- You are choosing who carries variance, and paying accordingly.
- PPS suits thin margins and tight cashflow.
- Compare schemes over months, never over days.
Risk notice
Mining returns depend on coin price, network difficulty, block reward and electricity cost, all of which change continuously. Figures here are a snapshot under stated assumptions, not a forecast. This is not financial advice.
Frequently asked questions
Which scheme earns more?
PPLNS over a long horizon, because you are not paying a premium for certainty. PPS earns less on average but removes the variance.
Does pool size affect my earnings?
Under PPS, barely. Under PPLNS a larger pool finds blocks more regularly, which smooths payouts without changing the long-run average.
