Blockchain mining allows you to earn cryptocurrency. This requires specialized hardware and software. However, in practice, private miners' processes are inconsistent, making it very difficult to earn crypto on your own. To increase your chances of a stable income, mining pools are used.

Mining pool concept
This is when you mine cryptocurrency by teaming up with other private miners.

Mining pools emerged when the first difficulties with creating blocks independently arose. It turned out that doing so alone was too expensive and difficult. Therefore, miners were faced with the need to unite to facilitate the mining process.

Moreover, the development of Bitcoin has led to significant changes in hardware design—it now needs to be more powerful, and the software must also match. Naturally, the cost of such equipment also increases.

How do mining pools work?
Pools provide miners with a more stable income by combining their efforts. However, the payment must be divided among all participants, and each participant receives a smaller portion than if they were working alone.

Pools are used not only for Bitcoin mining but also for other cryptocurrencies. Each pool has its own coordinator, who organizes the miners' work and distributes the reward, the amount of which depends on the payment scheme. To choose a pool, you should research the top mining pools.

Pay-Per-Share (PPS) Mining Pools
The simplest and most popular scheme, where the reward for each created block is fixed, means the miner receives crypto even if they fail to create a block. However, they will have to pay a commission to the coordinator. These are the best mining pools.

Pay-Per-Last-N-Shares (PPLNS) Mining Pools
Here, the reward is only given if a block is created. The calculation takes into account the number of blocks submitted by each participant. This is multiplied by the result and divided among the pool participants, taking into account the coordinator's commission.

The Impact of Mining Pools on Decentralization
Nakamoto created Bitcoin as a completely independent currency and payment system. Until its market capitalization reached billions, no one considered control over the blockchain. This question later arose with other cryptocurrencies as well—their multiple price increases were already being considered at their inception.

It's important to understand that one of the most effective methods of control is hidden, unsuspected. You can't fight what you don't know! Moreover, even partial control will bring superprofits to anyone who tries to establish it.

Most cryptocurrencies are open source and have transparent transactions, but as of today, partial or even complete control takeovers are still possible. Developers and security specialists are working to prevent this. After all, cryptocurrency was originally conceived as a decentralized currency, uncontrollable by any system in the world.

However, there is a danger that a significant share of the network's total computing power could be concentrated in the hands of large mining firms, which could, in theory, threaten decentralization. To avoid this, miners should choose smaller pools for mining Bitcoin and other cryptocurrencies, choosing those that adhere to decentralization principles. Most developers have long been searching for ways to improve mining algorithms that will resist centralization.

Let's go into a little more detail to understand the scale of the problem.

The fact is that new blocks must be created continuously. If there is a pause in block creation in the Ethereum base chain, it will paralyze the circulation of not only the Ethereum coin but also related sidechains such as Polygon, NEAR, Arbitrum, and others.

This would lead to a crisis for the entire decentralized application ecosystem, whose market capitalization amounts to hundreds of billions of dollars. Millions of users will suffer, unable to receive and send transactions, rendering the entire system useless. Any interruption of the blockchain system, even a short-term one, would lead to disaster. And any permanent threat of transaction halts would lead to a sharp decline in the value of assets in the system. Therefore, the primary task of developers is to ensure the security of the "zero layer" of consensus.

Concerns arise among those who don't understand what a mining pool is and its role

in the overall system:

Verification miners have no authority to manage the blockchain. Even if we assume that a single mining pool controls the verification of all blocks in the network, it has no right to independently change the rules.
Managing companies benefit from more private miners joining the pool—they are heavily dependent on it. A mining pool is significantly weakened if individual miners leave it. This suggests that a mining pool cannot be considered an employer and dictate to its members what and how to do. Rather, it is a cooperative whose viability depends on the strength of its independent participants.

To carry out any malicious intent, the support of a majority of members is required. Considering that large, profitable mining pools have millions of members, organizing a takeover is an impossible task.

Conclusion
Mining pools in their current format are the most viable way to earn a stable income on PoW blockchains.

To receive rewards more frequently, you need to join a large, reliable mining pool. Chinese miners are currently in the worst situation, as the government is clamping down on large mining pools in the country. Two of them—BeePool and StarkPool—have already suffered from crackdowns. Other large mining pools based in China will also suffer soon.

But even if all the major Chinese companies are shut down, individual miners will still have a choice: new mining pools will emerge elsewhere to replace the ones that have fallen.