Thanks for bumping up your max hash rate to include me... I have not clue how well I will do since I have only been mining since August 2017 so I guess we will see.. Since we are going for easier to explain, I think it is best to switch to something tangible. Since I like cookies, this analogy will be 1 cookie = 1 share. The 5nd is 5 times the difficulty. Lets keep it simple and say that the difficulty is 20, so 5nd is 100. There is one cookie jar that can hold exactly 100 cookies which everyone is sharing. This is a special cookie jar where the bottom kicks out and throws away old cookies when another goes in (so the cookies are always fresh). For this example, lets say there are 3 miners working on filling the cookie jar. Each miner is making their own cookie type at different rates. The long term miner (miner 1) can make 1 peanut butter per minute. Our miner (miner 2) can make 3 chocolate chip cookies per minute and the third miner (miner 3) can make 6 ginger snaps per minute. Obviously if I ate all these cookies, I would not like cookies any longer, but you get the idea...
To keep it a little simpler, we will assume the block reward is 100 BTC, that cookie jar is initially filled only with peanut butter cookies (100 of them) and that full cookies are submitted once per minute – even though an S9 miner can do 13.5 Trillion hashes per second and the difficulty is also in the trillions, so in reality, our cookies are broken up into billions of pieces per second - but who wants to eat crumbs.
So when we start mining, the cookie jar is full of other miner’s cookies and none of ours (so sad – no BTC if a block is found). After each minute, miner 1 adds 1 peanut butter cookie to the jar, we add 3 chocolate chip cookies and miner 3 adds 6 ginger snaps and 10 old peanut butter cookies drop out of the bottom to the trash (or maybe I ate them). Lets assume we find a block after minute 5. There have been 5 peanut butter cookies, 15 chocolate chips and 30 ginger snaps added (and 50 old peanut butter cookies removed) so there are a total of 100 – 50 + 5 = 55 peanut butter cookies which is 55% of the jar, 15 chocolate chips which is 15% and 30 ginger snaps which is 30% of the jar. So 100 BTC gets distributed based on the percentages (actually 99.1 BTC gets distributed since Kano gets .9%).
If another block gets hit 5 minutes later, there have been a total of 10 peanut butter cookies added (5 new ones), 30 chocolate chips and 60 ginger snaps added (and all 100 of the old peanut butter cookies have been removed) so there are a total of 100 – 100 + 10 = 10 peanut butter cookies which is 10% of the jar, 30 chocolate chips which is 30% and 60 ginger snaps which is 60% of the jar. So the second 100 BTC gets distributed based on the percentages.
Assuming that these miners continue to contribute the exact same amount with no new miners, when a cookie is added, a cookie is removed so the percentages stay the same going forward. When that happens, you are getting the most payout you can. Obviously if your miner goes down for a few minutes, you wont submit cookies so your percentage goes down a little but not a lot. Also as more miners submit cookies to the jar, your percentage of the jar goes down (and your old cookies fall out a little faster). The other thing that messes with all this is that when the difficulty goes up every couple weeks, the cookie jar gets bigger – and the cookies that fell out from the smaller jar get added back into the bottom of the jar in the order they left (so the analogy is not as good then).
So in my view of PPLNS, it really has nothing to do with “ramping” at all. It is more about how many cookies you have put in the jar compared to everyone else. So if I were to win the 50TH for 5 days, there would simply be a more chocolate chip cookies added to the top of jar for those 5 days over and above my 13.5TH that I have been adding to the mix since August.
Well, that is my attempt!!! Hopefully I am not wrong and confuse everyone even more…
So if one of our long term experts can tell me if this concept is right or wrong that would be helpful. I use adobe flash with my signage business, so I can maybe come up with a "video" using these assumptions with the more fitting / easier to draw mining conveyor belt (similar to
https://www.youtube.com/watch?v=pBIkfLm_8js) and colored pebbles. But if my concept is totally wrong, then it would be a waste of most of a day's worth of time. Some people said it would be better with 5 cookie jars (5 conveyor belts) which I would need a ton of clarification before I could do a video.