What is the difference between a mining pool and a mining farm?

Author | Yuxing Produced | Vernacular Blockchain (ID: hellobtc)

Dabai has a friend who saw that Bitcoin is valuable and heard that Bitcoin is mined, so his eyes lit up and he wanted to go mining. But unfortunately, it is not that easy to enter the mining circle, and there is a lot of knowledge to learn. Today, let Dabai introduce what mining is and what is the difference between a mining pool and a mining farm?

01
Mining

In the article "What do Bitcoin miners and mining mean?", it is mentioned that in the Bitcoin world, Bitcoin is like "digital gold". Just like gold is mined from a gold mine, we want to "mine" Bitcoin from digital numbers to get Bitcoin rewards. The mining process is actually the process of solving computational problems. The implementers of mining are called miners.

To be more specific, mining is actually to continuously perform hash operations until the result of the hash operation is smaller than the target value. If you don’t understand this, don’t panic, just continue to listen to Dabai’s explanation.

In fact, the mining process is similar to rolling dice. For example, the rules of the game are to let Dabai throw 3 dice at the same time. If the number sequence thrown is less than 112, it means victory. Suppose the dice sequence thrown by Dabai at a certain time is 111 (the number on the first dice facing up is 1, the second dice is 1, and the third dice is 1), then it means victory and gets the game reward.

In the Bitcoin world, we have entrusted the process of "rolling dice" to some of our computing machines (mining machines). The above example is 3 dice being rolled at the same time, and the hash value in our Bitcoin is 256 bits, which is equivalent to rolling 256 dice at the same time. In the above example, a die has only 6 sides, which means 6 possibilities, but a "dice" in the Bitcoin world is equivalent to a coin with 2 sides (one side is 0, the other side is 1), so there are more than 10 to the power of 77 possible situations. Therefore, if a mining machine is mining, the probability of mining is still very small.

In the Bitcoin world, computers will continue to " roll the dice" until the resulting dice sequence is smaller than the target value, then a block will be generated, and the first miner to calculate the result will receive a certain reward. This is also a mechanism to motivate miners to mine.

02
Mining Pools

Dabai mentioned earlier that, for example, to find a sequence smaller than "112", one can only win when the dice sequence thrown is "111". However, life experience tells us that the possibility of throwing this sequence is very small, with a probability of 1/216. Assuming that Dabai keeps throwing dice there, he may not win until the end of the game.

But suppose Dabai joins a team of 10 people, and everyone in the team throws 3 dice until the dice sequence thrown by one person in the team is "111", then he wins, and Dabai can get his share of the collective reward obtained by the team.

The process from "individual dice throwing" to "group dice throwing" is equivalent to the merger of computing power in the Bitcoin world. The website established by this method of combined computing power is called a "mining pool."

In plain words, it is to gather individual mining machines together (that is, the process of connecting mining machines to mining pools), and then everyone provides computing power together, and finally obtains profits together, and then distributes the profits according to a certain distribution mechanism. In this way, the profit of a single mining machine will be relatively stable. Moreover, the mining pool is a collection of computing power of several mining machines. It is a platform and is not restricted by regions. For example, F2Pool's mining machines are distributed in many countries around the world, including the United States, Canada, Singapore, and Russia.

03
Mining

I believe that through the previous explanation, everyone already knows that mining requires machines with computing power to calculate, so this calculation process will inevitably consume electricity, and people are also needed to maintain the mining machines and equipment.

Therefore, in order to reduce the cost of mining, people will think of putting many mining machines together for easy maintenance and management, and often choose a suitable area, such as Sichuan and Guizhou where electricity is relatively cheap. In this way, many mining machines are connected together for mining, forming a mining farm.

Compared with mining pools, mining farms are the actual places where mining machines are concentrated. They focus on the collection of mining machines in a certain area. For example, there are many mining farms in some places in Sichuan that are rich in electricity resources.

04
summary

A mining farm is a collection of physical hardware devices that describe mining machines, and a mining pool is a collection of computing power provided by these mining machines. Therefore, a mining pool does not need to be concentrated in one place. A mining farm refers to a collection of physical hardware devices, while a mining pool is relatively more figurative, referring to a collection of computing power that may be distributed in different places. It is a network platform.

Let's use rolling dice to describe the mining pool and mining machines. Dabai, Xiaohei, Xiaobai and others are in different places, and then they roll the dice together. Finally, the results of rolling the dice are concentrated through the Internet. This is more like the centralized computing power of a mining pool .

And if Dabai, Xiaohei, Xiaobai and others gather in a classroom, and they all participate in the dice-throwing game (that is, the mining machine performs calculations), then we can regard this classroom as a gathering place for playing the dice-throwing game, just like a Bitcoin mine .