Bitcoin Mining Pools Explained: PPS vs FPPS vs PPLNS, Fees and Solo Odds

What is a mining pool?

Definition · Mining pool

A service that coordinates many miners to work on the same block and splits each block reward between them by how much work each one contributed.

Every miner in a pool hashes on a job the pool hands out. The pool builds the block, and its reward address is the one that gets paid. When anyone’s machine finds a valid block, the whole pool is paid, and the pool then pays its miners. How it splits that money is the payout scheme.

How a pool works

Thousands of miners

Each hashes on a job the pool hands out

jobsshares

Pool server

Counts shares, builds the block, splits rewards

found blockblock reward

Bitcoin network

Accepts the block and pays the pool’s address

Every miner works on the same block. Whoever’s machine happens to find it, the reward goes to the pool, and the pool pays everyone for the shares they sent.

New to mining itself? The complete guide to Bitcoin mining covers blocks, hashing and rewards from the ground up, and proof of work explains the puzzle every miner is racing to solve.

Why do mining pools exist?

Because of variance. Mining is a lottery with fair odds: every hash has the same tiny chance of winning a block. Your share of the network’s hashrate sets your odds, and with about 144 blocks a day, a small share means a very long wait.

At today’s network hashrate (1003 EH/s, live), one modern ASIC at 200 TH/s would find a block on its own about once every 95 years on average. Its expected payout over a month is only 0.00270886BTC, but solo it gets that as a whole block or, far more likely, nothing at all.

average wait for a block = network hashrate ÷ your hashrate × 10 minutes

Blocks are found at random. This is the average wait; the real one can be much shorter or much longer.

Solo odds · live network

How long would you wait for a block on your own?

200 TH/s

Average wait for a block, solo

96 years

A pool would instead pay about 0.00009008BTC a day before fees (about $7.58).

In a month1 in 1,164

In a year1.0%

In ten years9.9%

Chance of finding at least one block solo.

Estimate at today’s network hashrate (1003 EH/s, live, updated hourly) and a block reward of 3.14500000BTC including average fees. Assumes the network stays the same size, which it rarely does. 1 ASIC here means about 200 TH/s.

A pool fixes this by adding everyone’s odds together. A pool with a large slice of the network finds blocks every day, and pays you your cut of each. Over time you end up with about the same amount, minus the fee, but it arrives steadily, which matters when the power bill comes every month. The difficulty guide covers why the odds keep moving.

Solo mining vs pool mining: which is better?

For nearly everyone, a pool. Solo only makes sense as a deliberate gamble, or at a very large scale.

	Solo mining	Pool mining
Expected payout	Full value, no pool fee	Full value minus the pool fee
How it arrives	A whole block, or nothing	Small amounts, often daily
Who carries the luck	You, all of it	The pool, or shared (depends on the scheme)
What you need	Your own node plus mining software	Just the pool address and a worker name
Who picks transactions	You	Usually the pool (Stratum V2 can change that)
Good for	Huge farms, or a lottery ticket	Home miners and most farms

Solo’s one real upside is that you keep the full block, fees included, and build your own block template. The price is a payout you may wait a lifetime for. Planning your own setup? How to start Bitcoin mining walks through the hardware, the pool and the settings.

What are shares and share difficulty?

Definition · Share

A hash that meets an easier target set by the pool. It isn’t a valid block, but it proves your machine is doing the work, and the pool counts shares to decide how much of each reward is yours.

Blocks are too rare to measure anyone’s work by, so the pool sets its own, much easier target. Your miner reports every hash that beats it. Now and then one of those shares also beats the network’s real target, and that one is a block.

Shares and blocks are the same kind of hash

Hash too high, thrown awayShare: proves workBlock: pays the pool

Illustration, not to scale. In reality the block line sits trillions of times lower than a typical share line.

The pool’s target is called the share difficulty. Most pools adjust it for each miner (“vardiff”) so a fast machine doesn’t flood the server and a slow one still reports often enough to be measured fairly. For one 200 TH/s machine, the maths works out like this:

Expected shares = hashrate ÷ (share difficulty × 2³²). A higher difficulty means fewer, bigger shares; the work counted is the same.
Share difficulty	Shares sent	Per minute
8,192	5.7 a second	about 341 a minute
65,536	0.71 a second	about 43 a minute
524,288	0.09 a second	about 5 a minute

PPS vs FPPS vs PPLNS: how do pools pay?

The scheme decides one thing: who carries the luck of when blocks are found. Your long-run average is about the same under all of them, minus the fee.

Who carries the variance?

You carry itThe pool carries it

Solo
All the luck is yours
PPLNS
You ride the pool’s luck
PPS+
Subsidy fixed, fees follow luck
PPS / FPPS
The pool carries it

The more luck the pool takes off you, the higher the fee it usually charges for it.

Scheme	How you’re paid	Who carries the luck
PPS (pay per share)	A fixed amount per share, based on the block subsidy, whether or not the pool finds blocks	The pool
FPPS (full pay per share)	Like PPS, plus a share of transaction fees, usually averaged over recent blocks	The pool
PPS+	Subsidy paid like PPS; transaction fees shared out like PPLNS	Mostly the pool
PPLNS (pay per last N shares)	Only when the pool finds a block, split over the last N shares before it	You, with the rest of the pool
Solo through a pool	The whole block if your own machine finds it, minus a fee	You, all of it

PPS and FPPS: paid for every share

Under PPS the pool pays you the expected value of each share straight away. If the pool has a bad week, it pays out of its own pocket; a lucky week, it keeps the extra. Plain PPS only covers the block subsidy. FPPS adds a share of transaction fees on top, so it pays more. That risk is why these schemes usually carry the higher fees. The hero simulator at the top of this page shows FPPS as the near-flat orange row.

PPLNS: paid when the pool wins

PPLNS pays the last N shares before a block

last N shares get paid

₿

older sharesblock found

Your shares (5 of 28 in the window)Other miners

When a block lands, its reward is split over the shares in the window, so here you’d get 5 of 28 parts. Faded shares fell out of the window before a block came, so they earn nothing this time.

PPLNS pays nothing until the pool finds a block. Then the reward is split over the last N shares, whoever sent them. A lucky month pays more than average, an unlucky one less. Smaller pools find fewer blocks, so their payouts swing more. The fee is usually lower, and the window rewards miners who stay: switching pools means leaving shares behind that haven’t been paid yet.

How much do mining pools charge?

Usually a few percent of what you earn, taken before your payout. The fee buys the pool’s servers and staff and, under PPS or FPPS, the risk of paying you through its unlucky streaks. Look at these along with the headline fee:

What the fee is taken from. The subsidy only, or subsidy and transaction fees.
Minimum payout. Small miners can wait a while to reach it.
How you’re paid. On-chain, and at some pools over Lightning, which suits small, frequent payouts.
Who pays the transaction fee on your payout. Sometimes it’s you.

What the fee costs one 200 TH/s machine over 30 days

1% fee

0.00002709BTC

2% fee

0.00005418BTC

3% fee

0.00008127BTC

4% fee

0.00010835BTC

Out of an expected 0.00270886BTC over 30 days at today’s network hashrate and block reward (live, updated hourly), before electricity. Example fee levels, not quotes from any pool.

We don’t list specific pools’ fees here because they change often. Read the pool’s own fee page before you point a machine at it. Whether mining pays at all depends far more on your electricity price than on the fee; the profitability guide and the profit calculator run those numbers.

What is Stratum, and what changes with Stratum V2?

Stratum is the protocol miners use to talk to a pool. Your ASIC opens a connection, the pool sends it work, and it sends back shares. When you set up a miner, the pool address you type in starts with stratum+tcp://.

A Stratum V1 session, message by message

Miner

Pool

mining.subscribe

Hello, I’m a miner

mining.authorize

This is my worker name

mining.set_difficulty

Send shares at this difficulty

mining.notify

Here’s a new job to hash

mining.submit

Here’s a share I found

Plain-text JSON over a TCP connection. The last two repeat all day: a new job every time the pool updates the block, a share every few seconds.

Stratum V1 has worked since 2012, but it has weak spots. Messages are plain text and usually unencrypted, so an attacker on the network path can quietly redirect a miner’s hashrate. And the pool alone picks which transactions go into the block.

	Stratum V1	Stratum V2
Format	JSON text	Binary, more compact
Encryption	Usually none	Encrypted and authenticated
Bandwidth	Higher	Lower
Block template	Always the pool’s	Miners can declare their own (optional)

Who decides what goes in the block?

Stratum V1

Picks transactions: The pool
Miner sees: Only a job to hash
Traffic: Plain text, usually unencrypted

Stratum V2 with job declaration

Picks transactions: Can be the miner
Miner sees: Its own template
Traffic: Encrypted, binary

Job declaration is optional in V2. A pool can support V2 and still build templates itself.

Why does pool concentration matter?

A handful of large pools find most Bitcoin blocks. You can see today’s split on the live mempool.space mining dashboard. That concentration is a real weak spot, even though pools don’t own the machines pointed at them.

1
Pools choose transactions
Under Stratum V1 the pool builds every template, so a big pool could leave certain transactions out of its blocks.
2
Size adds up to power
A pool, or a group of pools, with more than half the hashrate could rewrite recent blocks. See 51% attacks.
3
Miners can leave
Hashrate isn’t locked in. Miners have moved away from pools that grew too big, and switching takes minutes.
4
V2 hands the choice back
With job declaration, miners build their own templates and use the pool only to smooth out payouts.

If you mine yourself, picking a smaller pool with a fair scheme is a small, real contribution to keeping Bitcoin decentralised.

How do you choose a mining pool?

Start from how much luck you can live with, then compare the details.

1
Pick a payout scheme
FPPS for steady, predictable income. PPLNS for a lower fee if you can ride out swings and plan to stay.
2
Read the fee with the scheme
Compare FPPS with FPPS. A low fee on plain PPS may skip transaction fees entirely.
3
Check payouts
Minimum payout, how often it pays, and whether it offers Lightning or covers the transaction fee.
4
Use a nearby server
Lower latency means fewer stale shares, which are work the pool can’t count.
5
Look for transparency
Published blocks, a clear fee page, and a dashboard that shows your hashrate as the pool sees it.
6
Think about size
The biggest pool isn’t the only safe choice. Stratum V2 support is a bonus.

Before any of this, do the sums on your machine: choosing a mining machine and the hashrate converter help, and the mining farm guide covers running many at once.

Where does an app like CloudMineCrypto fit?

CloudMineCrypto lets you earn Bitcoin mining rewards for free, with no machine, no pool account and no power bill. Claim the free plan, watch ads, play games, complete offers or check in daily, and each one gives you mining hashrate. Your BTC balance grows while your plans run. Want more speed? You can add an optional paid plan.

BTC per hour = plan hashrate ÷ network hashrate × 6 blocks × block reward

The formula the app uses to estimate your rewards. Boosts are extra; rules and limits apply (Terms §5).

4.60 GH/s

Free plan hashrate

live

8 hours

Free plan runs for

claim again when it ends

0.0000000006930BTC

Estimated per free claim

before boosts, updated hourly

1003 EH/s

Network hashrate

live

There’s no luck to ride out and no pool to pick. The app works out your rewards from your plan’s share of the whole network, so your balance grows at the expected rate, like the dashed line in the simulator above. When you’re ready, you withdraw to your own wallet on Bitcoin, Lightning or BNB Smart Chain. Validated requests are processed automatically; some are reviewed, and limits or verification may apply.

Live numbers for every plan are in how much Bitcoin will I earn. Comparing options? See how cloud mining works, whether CloudMineCrypto is legit, and the mining glossary for any term on this page.

Frequently asked questions

What is a mining pool in Bitcoin?

A group of miners who point their machines at one server, work on the same block and split the rewards by how much work each one did. It turns a rare, huge payout into small, regular ones.

Is solo mining worth it?

Only if you treat it as a lottery ticket. The expected payout is the same as in a pool, minus the pool fee, but a single home ASIC would wait many years on average for a block and may never find one.

What’s the difference between PPS, FPPS and PPLNS?

PPS pays a fixed amount for every share, so the pool carries the luck. FPPS does the same but also passes on an average of transaction fees. PPLNS only pays when the pool finds a block, split over the last N shares, so your income follows the pool’s luck, usually for a lower fee.

How much do mining pools charge?

Usually a few percent of what you earn. Schemes where the pool carries the variance, like PPS and FPPS, tend to cost more than PPLNS. Check the pool’s own fee page, because fees change.

Can I switch mining pools?

Yes. You change the pool address and worker name in your miner’s settings, which takes minutes. On PPLNS you give up the shares still in the old pool’s window, so switching often costs a little.

What is Stratum V2?

The successor to the Stratum protocol miners use to talk to pools. It’s binary and encrypted, uses less bandwidth, and has an optional job declaration part that lets miners choose the transactions in their blocks instead of the pool.

Do I need to join a mining pool to use CloudMineCrypto?

No. You claim free mining plans (or add an optional paid one), and the app estimates your rewards from your plan’s hashrate as a share of the whole Bitcoin network. A plan doesn’t give you ownership of, or a share in, any pool or hardware, and rewards are estimates that aren’t guaranteed.

Sources and further reading

Pooled mining and payout schemes · Bitcoin Wiki
Mining pool reward FAQ · Bitcoin Wiki
Mining guide: solo and pool mining · Bitcoin developer documentation
Stratum mining protocol · Bitcoin Wiki
Stratum V2: the next-generation mining protocol · Stratum V2 working group
Mining dashboard: hashrate, difficulty, pools · mempool.space

Live figures on this page (network hashrate, block reward, BTC price) come from the CloudMineCrypto API, refreshed hourly, and are labelled where they appear. This guide is educational and not financial advice. CloudMineCrypto is not an investment product; rewards in the app are estimates and aren’t guaranteed.

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