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What Is a Mining Pool?

If miners collaborate to improve their chances of completing the block and receiving rewards, it's known as mining pools. Instead of mining by themselves all participants pool the power of their computers. If the pool is successful in solving one block, the reward is distributed among the participants according to the amount of effort each participant puts into.

Imagine mining as a collective effort. Even if you're not necessarily the most efficient miner working in a group improves the chance of being successful. Because the collective strength of the group functions more effectively, blocks are completed faster than if every miner worked on their own. When a block is solved the pool manager who oversees the service pays the small amount and the remainder of the reward is divided between the miners.

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