How Does a Pool’s Luck Factor Influence the PPLNS Payout Model?
A pool's luck factor is the ratio of the actual number of shares submitted to find a block versus the statistically expected number of shares. In PPLNS, if a pool is "lucky" (finds a block with fewer shares than expected), miners receive a larger reward relative to their effort.
Conversely, if a pool is "unlucky," miners may have to submit many more shares before receiving a payout, leading to high variance.
Glossar
Luck Factor Influence
Variance ⎊ Luck Factor Influence describes the short-term deviation of a miner's or pool's actual block discovery rate from its mathematically expected rate, which is proportional to its share of the total network hash rate.
PPLNS Payout
Payout ⎊ The PPLNS Payout, an acronym for "Principal Protected Leverage Notes with Non-Standardized Payouts," represents a specialized derivative instrument increasingly utilized within cryptocurrency markets, particularly concerning options and perpetual futures contracts.
Luck Factor
Factor ⎊ In cryptocurrency derivatives and options trading, the Luck Factor represents the quantifiable impact of unforeseen, non-modelled events on realized outcomes.