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I understand that the header given to some miner contains hash of Coinbase that goes to servers address. Thus the miner cannot take the reward.

Also in the simplest setup the server gives miner a range of nonces to check and the range that miner checks is proportional to his hashing power and proportional to the reward.

How does server ensure miner checked that range?

  • Possible duplicate of How do mining pools work? – renlord Nov 6 '17 at 8:37
  • That question is an overview of mining pools. My question is specific, not answered within the scope of that question. The only thing I found there is "To do this there's specific software installed on the admin's server that takes care of making sure each miner is doing the work requested." I'm interested in how that "software" works. – croraf Nov 6 '17 at 16:30
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Miners regularly send "shares" to the pool server. The shares are solution to a low-difficulty bitcoin puzzle. Each share stands some chance of being a solution to the current bitcoin puzzle, of much higher difficulty.

By sending shares, miners show that they are working on the problem, and may potentially reveal its solution to the pool server. They are often remunerated based on the number of shares they find, and of their difficulty.

  • Can you elaborate more on the answer. Solo miner calculates SHA-256 of block header, this is the 'normal puzzle'. What is the low-difficulty puzzle? – croraf Nov 6 '17 at 22:41
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    The low difficulty "puzzle" is just like the normal "puzzle" except the target is much higher so the difficulty is lower (it's an inverse relationship). This means that a miner is more likely to find a share and the pool can track that the miner is actually doing work. By the randomness property of hashes, a miner will eventually find a hash that is also less than the actual network target (and thus be less than the pool target) and that block is what the pool submits to the network. – Andrew Chow Nov 7 '17 at 5:21
  • You should perhaps post this as an answer. – croraf Nov 7 '17 at 8:48
  • rephrasing, let say that the current difficulty is to find a hash of transaction starting with 17 zeros, if a miner finds a hash starting with 8 zeros then it is a share proving that the miner did some work. If this is the case, the miner could also do the minimum amount of work to solve these kind of puzzles. But perhaps you are rewarded based on the difficulty of your shares (if you find hash starting with 10 zeros, you might get a bigger part of the reward because it proves that you worked more). No idea if this is what is implemented though. – David 天宇 Wong Sep 14 at 16:26
  • these explanations also do not say how the pool prevents a miner who finds a solution from not sharing it. EDIT: of course, the transaction that everyone is trying to mine uses the pool's address as recipient of the coinbase – David 天宇 Wong Sep 14 at 16:27

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