As pools are coming closer and closer every day and some pools already started to operate on the “beta” or unreleased pooling protocol it might be the best time to choose, which pool you will join.
Currently at the miningpoolstats website there are over 150 different pools. That’s an overwhelming lot of pools to choose from. So what should you look out for and what should you avoid?
This is an informational post. Nothing here is intended to be financial advice. Nothing written here can replace your own research and judgement. Please be careful when choosing who to trust with your rewards.
In this post there are deliberately no suggestions on which pool to choose as I do want to be neutral and leave the decision up to the reader.
You might ask yourself, why you should even care which pool to choose in the first place, the pooling protocol is “secure by design” you may think. As much as it is true that you can’t cheat the official protocol, pool operators still can cheat you (intentionally or not). “How can they cheat me?” you ask?
Well. They can just plain out not pay you. They will make up stories about how and why they can’t pay you until they accumulated enough precious XCH and just run away.
They could pay you less than you deserve. There is almost no possible way for the average joe to proof that they get what they deserve.
Last but not least, hackers will be out to scavenge for insecure pools and hack their pool wallets to steal all your rewards.
So with that list, you might already be able to see, what you should look out for in pools.
My list of criteria is as follow:
- Do they provide accurate means of contacting them?
- Are they a well known legal entity (e.g. a registered business)
- How big is their team? Running a pool is not a one man show.
- Do they try to hide themselves behind nicknames?
- How will they finance their maintenance costs? (e.g. “no-fees” pools can’t be viable in the long run)
- Do they have prior knowledge of operating a pool for another crypto currency?
- If yes, how did they do it?
Most of the pools from the above list will not even pass the first criterion. You will not have any meaningful way of getting in contact with them if there are any issues. To decide what a “meaningful way of contact” is is up to you and might as well depend on how big your farm is. If you only get $1-2 a day, a simple discord or twitter contact might suffice, but if you plan to get several $100 a day/week, you might want to have a better way of contacting the operator.
This is in no way a complete list of what to look out for. After all, it’s just my list I used to decide which pool to join. You will have to adapt your criteria to your needs and situation. For a very small farmer with just a few low 2 digit TB of storage, all of this can be completely irrelevant.
At the end, please ask yourself: Would you trust a random and anonymous person enough to give them 40$ a day and sometime in the future expect them to pay you back? That’s what you do, you lend them your money and have to trust them to give it back to you when you request it.
One last note: You may have noticed that I did not include pool space in the list of criteria to choose a pool. And that is because it just does not matter that much. The bigger the pool, the smoother the payouts can be. But at the end you will make roughly the same on whatever (honest) pool you joined.
Update: Another great resource for checking out upcoming pools is the Chia Pool Directory