Pay-Per-Last N Shares (PPLNS) is a cryptocurrency mining pool reward distribution method. In a PPLNS system, miners are rewarded based on the number of shares they contribute within the last 'N' shares submitted to the pool before a block is successfully mined. This approach ties rewards to recent contributions. It promotes fairness and consistent participation among miners.
In the PPLNS model, the mining pool maintains a "sliding window" of the last 'N' shares submitted by all miners. When a block is mined, miners distribute the total block reward proportionally based on their share contributions within this window.
For example, if the pool sets 'N' to 1,000,000 shares and a miner has contributed 10,000 shares within this period, the miner would receive 1% of the block reward. Shares outside the 'N' window do not contribute to payouts for that block.
PPLNS rewards are distributed only when a block is mined. This can cause short-term earnings to fluctuate based on the pool's success in finding blocks. This introduces variability in payouts, with periods of no rewards followed by higher payouts when blocks are discovered.
PPLNS encourages long-term commitment by rewarding miners who consistently contribute shares over time. This reduces the likelihood of "pool hopping," where miners switch pools to maximize short-term gains. It fosters a more stable mining environment.
Compared to fixed-payment models like Pay-Per-Share (PPS), PPLNS pools often have lower fees. Since the pool does not take on the risk of paying miners without finding blocks, operational costs are reduced. This benefits miners with lower fees.
While PPS provides a fixed payout for each share submitted, PPLNS distributes rewards based on recent share contributions. This results in lower fees for PPLNS pools. PPLNS introduces variable rewards tied to poor performance. In contrast, PPS offers predictable income but at a higher cost to the pool.
SOLO mining allows individual miners to earn the entire block reward. However, it has high variability and resource requirements. In contrast, PPLNS offers more consistent, albeit smaller, payouts by pooling resources.
Rewards are distributed based on recent contributions, making PPLNS more suitable for miners with limited computational power seeking steady income.
Alex, a software engineer with a modest mining setup, joined a PPLNS pool to gain consistent payouts and leverage community support. Over a year, his steady contributions yielded regular earnings and a decent return on investment. This highlights PPLNS's suitability for miners with limited computational power.
Grace, an IT entrepreneur with substantial mining resources, opted for SOLO mining to capture full block rewards. Despite initial delays and high variability, her powerful setup eventually resulted in significant earnings. This demonstrates the high-risk, high-reward nature of SOLO mining compared to PPLNS.
PPLNS is ideal for miners who: