PPLNS

PPLNS stands for pay per last N shares. It pays out of blocks the pool actually finds. Each block is shared among the last N shares submitted, rather than among the shares of the current round alone.

Here is how it works. The pool keeps a moving window of the most recent shares. When a block is found, its reward, minus the fee, is split across the shares in that window by their difficulty. A share can sit in the window for more than one block, so it can earn from several blocks, or from none if the pool is unlucky.

Under PPLNS the miners carry the luck, not the pool. When the pool finds blocks faster than expected, everyone earns more. When it has a slow stretch, everyone earns less. Over months it averages out to the expected value. Because the pool takes no payout risk, PPLNS fees are often lower than pay per share fees.

The window is what discourages pool hopping. If you leave, your shares stay in the window and can still earn from the next blocks, until newer shares push them out. If you join, your first blocks pay less, because your shares have not yet filled the window. A steady miner gets the full value. A miner who keeps switching pools loses a little each time.

A common mistake is to judge a PPLNS pool by one day of earnings. A single lucky or unlucky day says little. Look at a week or more, and compare the pool's effort over time rather than its last few blocks.

The trade-off is that payouts move with the pool's luck. If you need steady income, a pay per share scheme moves that luck to the pool, usually for a higher fee. The scheme each HeroMiners pool runs is shown on the HeroMiners hub, on the All Pools overview, and the payout schemes article compares them all.