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The "double geometric" payout method as used on the Ozco.in pool is supposed to be fair and prevent pool hopping, but is this method fair to miners that only mine for a few hours per day, as opposed to miners that mine 24/7?

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Some linking would be appreciated. Also, you might want to check this resource out - bitcoil.co.il/pool_analysis.pdf – ThePiachu Jun 23 '12 at 2:06
Related: bitcoin.stackexchange.com/q/370/516 – Highly Irregular Jun 23 '12 at 2:21

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Yes. If you mine at a given point in time, you do not know when a block will be found, and thus your reward for shares you submit is a random variable. DGM is constructed so that the average reward for a submitted share is always equal to what you would get from it in PPS (assuming equal fees). The total reward for all shares you submit is additive - so it follows that the average reward you get in DGM is equal to what you would get in PPS, no matter what is your mining pattern.

However, the reward you will get is random and has some variance, and the variance is greater if your mining is intermittent. The exact degree of this depends on the parameters used by the pool.

More background information about mining pool reward methods can be found in Analysis of Bitcoin Pooled Mining Reward Systems.

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Not quite always equal I think. I believe with plain PPS the pool operator wears the cost of block withholding attacks, but with DGM the other miners wear most of the cost. – Highly Irregular Dec 26 '12 at 9:17
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@HighlyIrregular: This is true, the analysis assumes finding shares and submitting them is an atomic action. However, block withholding is also more expensive to carry out against DGM; and, this is not relevant to the specific question about intermittent mining - in the broadest sense, the payout in PPS will be lower because of the higher fee (which exist to compensate for the risks, one of which is block withholding). – Meni Rosenfeld Dec 26 '12 at 9:49
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As far as I know, yes. The expected value (in BTC) of a share is constant in time, for a given difficulty/pool-hashrate/etc.

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up vote -1 down vote

If you are only mining a few hours a day, this will not likely work for you.

The way DGM works is that at the start of a new block all miners start to gain credit for the block. All miners will gain a cut. For instants when I mine with 1.6 GH in a pool with about 1.8 TH I'll receive 0.043xxx BTC when the block is solved. If the block takes 5 minutes I get that for 5 minutes work. If it takes 5 hours then I have to work for 5 hours. Over time this averages out so long runs and short runs are inconsequential. However if you mine on a 5 hour block for only 2 hours then your reward is going to be substantially lower.

Another point worth mentioning. On many pools your award is not paid until the block is confirmed. This usually takes about a day.

My recommendation is to use a PPS Pool if you are going to only be mining from time to time.

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I'm afraid this is incorrect. You will be rewarded on average in exact proportion to your work on DGM. You don't know in advance when a block will be found, so you're as likely to get more than average as less. – Meni Rosenfeld Nov 25 '12 at 20:35
The process of averaging works if you mine constantly. It you mine for a few hours a day, you are not going to receive the same proportional share as if you mined constantly. Since the end goal for DGM is to provide an average value that is equal to PPS, my suggestion is to mine PPS if you are going to mine only for a few hours a day. – mjc Dec 2 '12 at 19:31
I have mined both ways and I mine constantly with 1.6 GH and I still perfer PPS. With DGM if a block is invalidate then you don't get paid. What i saw was I made less the two days I mined DGM and I had wait 24 hours for the 120 confirmations of the blocks before I was paid. I think that DGM favors the pool operator, where as PPS favors the miner. – mjc Dec 2 '12 at 19:31
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Again, this is wrong. However, SE comments are not suited for debates, and I will be happy to take this elsewhere. – Meni Rosenfeld Dec 3 '12 at 5:57
There's no free lunch, PPS only pays for invalid block by taking an extra fee to compensate for them. Mining rewards are random and depend on the pool's luck in finding blocks so you can't learn anything by experimenting for 2 days. PPS has more variance for the operator and less for miners, but correspondingly the operator will take more fees. – Meni Rosenfeld Dec 3 '12 at 5:57
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up vote -2 down vote

I find it interesting that the creator of DGM is here, claiming user statements are incorrect. As with any "hop-proof" payout schema...

It has the net effect of punishing miners who don't mine for an entire round. DGM greatly reduced the risk to the pool op by transferring those losses to the miners. PPS is exactly the opposite, pool ops take all the risk & variance instead of miners.

DGM is for pool ops who can't manage their business well enough to keep correct reserves. Miners will quickly find their earnings decreased and start looking for other more favorable payout schemas.

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Like it or not, PPS increases risk for the pool operator. Risk costs money. That money must come from somewhere. – Nick ODell May 12 at 4:37
Risk and loss are not the same thing. In DGM miners have more variance, but this means they can get either more or less than normal. On average they will get the same amount in both PPS and DGM, assuming the same fee - which means, on the long run they will get more on DGM because of the lower fee. – Meni Rosenfeld May 23 at 13:46

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