Group Mining

Group Mining, also known as mining pool or group mining, is a practice in which cryptocurrency miners pool their computing resources to jointly solve transaction blocks and share rewards. This form of co-opetition in the cryptocurrency environment aims to streamline the mining process, increase the chances of winning rewards and minimize the risks associated with volatile rewards.
Key aspects related to Group Mining:
Shared source of computing power: In group mining, miners pool their computing power so that they work together to solve complex mathematical problems that are part of the blockchain’s block creation process.
Distribution of rewards: When a group solves a block, the reward for that block is divided proportionally among all group participants, usually based on the computing power they bring to the group. This allows miners to receive more frequent, albeit smaller, rewards compared to digging on their own.
Minimized risk:
Risk of reward instability: Digging on one’s own can lead to reward instability, since a miner only receives a reward if he or she solves a block on his or her own. In group mining, this risk is spread throughout the group.
Reduced risk of empty apologies (orphan blocks): When two miners simultaneously solve the same problem, blockchain splitting can occur. In group mining, miners share the rewards for each block, which reduces the risk of “empty apologies” (orphan blocks).
Choice of splitting algorithm: Mining groups have different methods for dividing rewards. One popular method is proportional sharing based on share of computing power (Proportional), where miners receive rewards in proportion to their share of the group’s computing power.
Economic Advantage: Group Mining can be more profitable for individual miners, especially those with limited computing resources. By working together, they are more likely to earn rewards.
However, it is worth remembering that there is also some reliance on a trusted group leader to manage the rewards and profit-sharing process. Digging groups are a key part of the cryptocurrency ecosystem, and miners often choose this form of digging because of the potential economic benefits and minimized risk.