Quote from: tanzislam on February 28, 2014, 10:39:14 PM

Quote from: ronnie173 on February 26, 2014, 06:06:25 AM

Quote from: organofcorti on February 25, 2014, 09:51:50 PM

Quote from: ronnie173 on February 25, 2014, 06:21:13 PM

Hi,

Requesting new Bitcoin Pool add https://bitcointalk.org/index.php?topic=481194.0

Pool: Coinminers
Website: https://coinminers.co
Payout method: PPS
Fee: 1% (currently 0% for beta phase)
Pay Tx Reward: Yes
Vardiff: 16 to 1024
Local Work: Stratum
Pay Orphans: No
Min Withdrawal: 0.10
Merge Mining: No

Thank you

I'll add you to the list - but before I do, are you sure you want to go with proportional reward? It's a bit dangerous for any pool. There are only two pools left doing proportional rewards and neither of them are doing well.

I think that I will change it to PPS .

PPS at 1% (where pool must credit miners as difficulty-1 shares are submitted, regardless of whether an actual block at current difficulty is found or not) is even riskier than Proportional or PPLNS[G] (where pool credits miners only when block is actually found at current difficulty).

According to Meni Rosenfeld's analysis in Chapter 2.2 here: https://bitcoil.co.il/pool_analysis.pdf ,the relationship between fee, probability of pool bankruptcy, starting reserve and the block reward is:

Code:

R = B log(1/delta)/2F
R = starting reserve
B = block reward
delta = probability of pool bankruptcy

So if you have a fee of 1% and you only want a one in a thousand chance of pool bankruptcy, then:

Code:

R = 25 * log(1000) / 0.02
= 8634.694

So if you want to run a PPS pool with a 1% fee, you're going to need a starting reserve of over 8600 bitcoins.

This is a huge, locked in reserve - you can't ever spend these coins while you run the pool. This means in the long term you'll lose money, since you won't be able to use the reserve for any other investment.

Choosing the fee is a balancing act - how small a fee can you afford (to attract customers) against the largest reserve you can afford and the probability of bankruptcy.

Say you charged a 10% fee, and were ok with a 1 in 100 chance of bankruptcy:

Code:

R = 25 * log(100) / 0.2
= 575.6463

Even in this case you'll need a reserve of nearly six hundred coins.

tl;dr current forms of PPS are not for the faint-of-heart.