Crypto glossary
Pool payout methods (PPS, FPPS, PPLNS)
Pool payout methods such as PPS, FPPS and PPLNS decide how a mining pool pays its members and who absorbs the luck of finding blocks.
Miners in a pool submit shares, easier proofs that show how much work they contribute. Pay per share (PPS) pays a fixed amount for every share based on the expected block subsidy, whether or not the pool finds blocks; the operator takes the variance risk and charges a higher fee. Full pay per share (FPPS) works the same but also includes expected transaction fees, and has become the most common scheme at large Bitcoin pools.
Pay per last N shares (PPLNS) pays only when the pool actually finds a block, splitting the reward among the shares submitted in a recent window. Miners bear the luck: income is lumpier, but fees are lower and the operator does not need large reserves. Other variants such as PPS+ and TIDES mix these approaches, often paying fees according to actual blocks found.
The choice affects more than smoothness of income. PPS-style pools need deep reserves and can fail if a bad run of luck coincides with falling prices. PPLNS penalises miners who hop between pools. Pool fees, payout thresholds and transparency about how fees are calculated are worth comparing alongside the method.
Example
Under FPPS a miner receives a steady daily payout even in a week when the pool finds fewer blocks than expected, while under PPLNS the same miner would earn less that week and more in a lucky one.