Quote from: nottm28 on June 27, 2014, 05:22:40 PM

Quote from: mstrongbow on June 27, 2014, 04:24:54 PM

Quote from: hoeslayer on June 27, 2014, 03:04:25 PM

If the difficulty goes up and u have 900 gh and receive .01 as reward per block found does the reward for your work drop as the difficulty goes up?

Correct. That is why a cryptocurrency miner must continually increase their hashrate

Not correct, increasing difficulty will not alter your slush reward per round - just makes blocks harder to find and hence you find them less often...

~~Slightly correct~~ Not exactly. You would assume if the difficulty is increasing, the pool hash rate is at least increasing slightly.

Assuming your hash rate does not grow:
1) Pool hash rate is growing at the same rate as the network => Same rate of block finds, but you get a smaller reward per block.
2) Pool hash rate is shrinking proportionally to the network (IE: Network grows 30%, pool only grows 20%) => Lower rate of block finds, you get a smaller reward per block.
3) Pool hash rate doesn't change => Lower rate of block finds, you get the same reward per block.
4) Pool hash rate is growing faster than network growth rate => Faster rate of block finds, but you get smaller rewards per block

In all 4 scenarios though, your expected earnings are decreasing since your hash rate is stagnant while the network difficulty continues to grow.

I've bolded the one that is most likely given the current mining climate. Manufacturers are continuing to build up private mining farms which effectively shrink the share traditional pools have of the network, since Bitcoin is a zero-sum game. For every large private farm that comes online, the amount which pools are able to obtain shrinks.

EDIT: Edited to clarify what I was responding to.