Topic: fast difficulty increase favours bigger pools (Read 1721 times)

The expected value should be the same, if you are in a smaller pool you need some luck and your share is way bigger then bigger pool. Bigger pool variance is smaller. Thats all

Big pool is better cause they have better DDOS protection, I see small pool down pretty common.

Variance always evens out.  Unless the pool goes under or you quit mining at that pool.  Now if you mean your hash rate does not increase but the pools hash rate does increase your share per block will go down.  But the flip side of that is that the pool will be solving more blocks so you will be receiving the smaller share per block more often.


I think that you think this is a get rich quick scheme, or at least recover your cost's quick scheme.  It's not, its a long term investment.  The history of Bitcoin so far shows that you recoup your investment by the increase of value in Bitcoin itself.

Also I think your OP main point was that ASIC Hardware developers need to cater to P2Pool somehow.  I think that responsibility lies with the Bitcoin Client developers.

The Bitcoin Client developers have been dragging their feet to make it possible to solo mine with ASIC hardware directly to the Bitcoin Client.  If the client developers implemented the proper protocols in the proper way and added User Defined Difficulty then ASIC hardware could easily solo mine and "I think" that would help P2Pool out allot too.  Maybe I'm wrong in that assertion because I'm not fully informed about P2Pool.

But I do think it is very import to be able to solo mine with ASIC hardware directly to the Bitcoin Client.  That is good for the network as most miners have their local Bitcoin client as the last pool in their failover list.

Sam

Variance will even out for the pool, but not for you unless you increase your hashrate.

So if you invest in a miner and hope to get return, the first couple of weeks are most important for you.
If you lose due to a small pool's variance you may never recover, unless you keep buying more miners.

Small pools have high variance.

With high variance, you are likely to get significantly more OR significantly less then you would at a low variance pool with 100% expected payout.

People mining at eligius over the past couple months are down about 5-7% due to variance. The pool has been overall unlucky.

I also have never seen a small pool do significantly well in the long term. 

When its lucky people will stay, but as soon as it gets unlucky, people leave, and then the hashrate drops, making it less likely that a block will be found, and then more people leave, and then the hashrate drops, making it less likely that a block will be found, and then more people leave, and then the hashrate drops, making it less likely that a block will be found, and then more people leave, and then the hashrate drops, making it less likely that a block will be found, and then more people leave, and then the hashrate drops, making it less likely that a block will be found, and then more people leave, and then the hashrate drops, making it less likely that a block will be found, and then more people leave, and then the hashrate drops, making it less likely that a block will be found, and then more people leave, and then the hashrate drops, making it less likely that a block will be found, and then more people leave, and then the hashrate drops.

Hopefully you get the point.

You should only mine at a large pool if you want close to 100% expected payout.

Yeaaaaah... no.

High variance is very dangerous, especially with the very short shelf-life of the ASICs being delivered. If a pool takes 3 weeks on average to find a block, they're unlucky and don't find anything for 5 or even 6 weeks, you've probably lost thousands of dollars.
[/quote]

OK, I guess I wouldn't consider mining at a pool that small as I wouldn't consider it viable.  So if that's what one would call small what exactly are you guy's calling big?

If a pool is only finding a block on average every three weeks it obviously has some other problems and it's hash rate probably isn't going up.

There are plenty of other pools who's hash rate has increased in proportion, more or less, with BTCGuild.  I just don't agree with the premise that miners are "forced" to mine at big pools and a big pool being BTCGuild.  My income is often higher from a small pool and my small pool is Ozcoin.

Yeaaaaah... no.

High variance is very dangerous, especially with the very short shelf-life of the ASICs being delivered. If a pool takes 3 weeks on average to find a block, they're unlucky and don't find anything for 5 or even 6 weeks, you've probably lost thousands of dollars. You could get very lucky - but with smaller pools, that's his point -- there's a lot more luck involved in getting a decent return. 3 weeks is an extreme, but the more variance you add, the more your returns will be affected by luck. Some people gamble in the form of buying a USB block eruptor and just mining solo -- maybe they get a winning number and enjoy a 25+BTC jackpot, but almost certainly not. Mining in a tiny pool isn't much different.

The only gamble is if you use an unreliable pool and/or don't use failover.  I'm sure the large hashers also use more than one pool just in case a pool does have problems.

Hashrate is increasing across the board.  So variance will even out over time.  Unless you have managed to find a pool that is not increasing its hash rate?

Most pools are increasing their rate so variance will even out.

yeah I know. But usually those miners who want to gamble just go to a gambling site.

I mean, if you invest thousands in mining hardware,   you've already taken  a considerable risk, thinking
that you can gauge your understanding of the mining hardware market to have  a positive expectation in this game. Then if you are rational, you  don't just go and stake your profit on a 0-expectation high-variance game.

Don't forget it works both ways.

You are just as likely to find MORE blocks than expected when you are in a smaller, high variance pool as you are to find fewer blocks.

That's how variance works.

So it is neither better or worse.

Variance evens out when the hashrate isn't increasing exponentially. This isnt the case right now with rapidly rising difficulty.

Variance evens out over time, even for small pools.  It only hurts you when bounce between pools allot, like I tend to do .
Sam

You were quite clear.  Your saying that we have no choice but to mine on the large pool because of the intolerable variance of smaller pools.

So of course the only solution is to force hardware MFG's to cater to P2Pool which has issues with high hashrate hardware in the first place.

Plus I have read where only the highest 5000 P2Pool hash rate users get any stake in the block in the first place.  P2Pool may be really neat and nifty, but is still needs some work before hardware MFG's should cater to it.


That was supposed to be just a joke.  Sorry if you took it as offensive, that is not how it was meant.
Sam

This was always the case even before ASICs, or GPUs for that matter. Why would one choose a small pool, where there's a lot of variance, was always beyond me. Right after it became non-viable to solo mine I've always chosen the largest pool there was at the time.

Now, for the sake of the network it is good that we have a lot of pools (large and small) but from a personal, egoistic, point of view you have to join one of the big ones.

Big pools get through bad blocks faster meaning they have more chances of finding blocks before the difficulty goes up.

if you read my (fairly short) post you'll see that I don't speak about forcing someone to do something,
but of the current increasing economic advantage of using bigger pools.


you seem to be taking me for someone else.

Human beings have free will and can therefore choose a small or medium sized pool if they like.

NO ONE is FORCED to use a big pool, they just chose to use a big pool.  A VERY different thing.

Now back to your regularly scheduled Rant.
Sam

subj.  Fast-increasing difficulty makes it impossible to recover 
 what you lose due to variance in time between blocks when mining on a smaller pool.
So one is forced to choose a larger pool (=small variance) or straight PPS; good prices on PPS are also
offered only by larger pools, for the very same reason.

 ASIC producers  are as much interested in network security as everyone else using BTC, so
they need to make explicit support for P2Pool, may be invest
in making the software easy to use as well.