Hópfremleiðsla

Hópfremleiðsla refers to a specific type of cryptocurrency mining, often associated with Bitcoin and other proof-of-work currencies. It describes a scenario where multiple miners pool their computational resources together to increase their chances of successfully mining a block and earning rewards. Instead of mining individually, participants contribute their hashing power to a shared pool.

When the mining pool successfully mines a block, the reward is distributed among the participants proportionally to the amount of hashing power they contributed. This distributed reward system makes mining more accessible and less risky for individual miners who might not have the significant hardware investment or consistent luck to mine solo.

Different pool operators offer various payout schemes, such as proportional, score-based, or PPLNS (Pay Per Last N Shares), which determine how the mining rewards are allocated. The emergence of mining pools has significantly changed the landscape of cryptocurrency mining, shifting it from a hobbyist endeavor to a more organized and competitive industry. While it democratizes access to mining rewards, it also centralizes a portion of the network's hashing power, which is a point of discussion within the cryptocurrency community regarding decentralization.