What Are Shares in Cryptocurrency Mining?

What Are Mining Shares and How Do They Work?

In cryptocurrency mining, a “share” serves as a proof of work that verifies the miner has performed the necessary cryptographic calculations. When mining within a pool, each participant submits these shares to demonstrate their ongoing computational activity. Because the network difficulty is exceptionally high, successfully discovering a complete block is relatively rare. To address this, shares are calculated at a lower difficulty, allowing pools to accurately track every miner’s contribution—even if the result doesn’t satisfy the stringent requirements for generating a new block on the main network.

Why Are Shares Needed?

Mining shares are a fundamental mechanism for gauging each miner’s contribution to a pool. Because fully solving a block is relatively rare, shares are continuous proof of work, confirming active computational efforts. These shares represent solutions to cryptographic puzzles at a reduced complexity, enabling the pool to document the activity of each participant regularly. As a result, reward distribution remains transparent and equitable whenever a block is successfully found—even when no miner has discovered a complete block solution at that moment.

In large-scale pools or mining farms with hundreds of devices working in parallel, shares become particularly vital for accurate coordination and assessment of each node’s output. For instance, in high-difficulty networks such as Bitcoin (BTC), Ethereum Classic (ETC), and Litecoin (LTC), the frequent submission of shares both streamlines reward distribution and helps pinpoint hardware bottlenecks swiftly.

Beyond reward calculation, shares also facilitate the pool’s day-to-day administration. By tracking these partial proofs of work, pool operators can monitor device efficiency, detect any irregularities in mining shares, and implement adjustments to optimize the mining process. This holistic oversight ensures the stability of the entire system. In essence, mining shares not only measure each participant’s contribution but also uphold the reliability and overall performance of the mining pool.

Differences Between a Share and a Hash

In cryptocurrency mining, a hash is the output of a cryptographic function generated from block data, which must meet the strict difficulty criteria set by the network. Miners produce an immense number of hashes in the hope of finding one that precisely satisfies these criteria, making it a valid solution to add a new block to the blockchain.

By contrast, a share is a hash that meets a more lenient difficulty target specified by the mining pool. While these “partial solutions” do not directly yield a valid block, they serve as proof of a miner’s computational work, enabling the pool to accurately measure each participant’s contribution. Ultimately, the hash represents the core computational result, while the concept of mining shares ensures fair reward allocation within the pool.

Types of Shares in Mining

In mining, shares are categorized according to their validity and technical condition, allowing the pool to objectively evaluate each participant’s contribution. Let’s consider the main types of shares.

Accepted Shares

Accepted shares are computational results that meet the difficulty parameters set by the mining pool and pass its validation checks. Each discovered share confirms that the miner has performed part of the cryptographic work, even if this result does not match the full difficulty needed to find a block on the main network. In other words, “good” shares in mining are valid, high-quality solutions reflecting the miner’s engagement in the pool.

The quantity of accepted shares underpins reward allocation: the more accepted shares a miner produces, the larger their portion of the reward. These shares allow the pool to objectively evaluate each participant’s contribution, monitor hardware performance, and refine the mining process to maximize productivity.

Rejected shares

Rejected shares are computational results submitted by a miner that, for one reason or another, were not accepted by the mining pool when rewards are distributed.

Shares in Mining

Broken shares are the results of calculations that have been corrupted or improperly generated due to technical malfunctions. Unlike rejected shares, these calculations don’t conform to the required format or pool protocol and are thus already “damaged” data stemming from hardware or software issues. Common causes include slow data transfer rates, faulty drivers, or misconfigurations in mining equipment.

Analyzing the volume of broken shares helps identify potential hardware and network issues. A higher proportion of broken shares may point to hardware failures, overheating, an unstable power supply, or software bugs. Addressing these factors can enhance mining efficiency and ensure a more stable pool environment.

Causes of Rejected and Broken Shares

Reasons for Rejected Shares can stem from delays, data transmission errors, or format-related issues. Below are the primary causes:

• Stale share is calculated on time, but it turns out to be irrelevant due to network delays or job updates by the pool. What is a stale share? When a miner sends a stale share and the pool has already changed the job in the meantime, his solution is considered outdated and is not taken into account.
• Share above target. In this case, the calculated share does not meet the difficulty parameters the pool sets. Its hash value is “above” the acceptable target, i.e. it does not meet the requirements for even a partial solution, which leads to its rejection.
• Duplicated share occur when the same result has been sent multiple times. Repeated transmissions can occur due to network errors or software malfunctions, so the pool only accepts the first occurrence of a unique solution and rejects subsequent ones.
• Other (Other): Includes cases where a share is rejected for miscellaneous reasons—data formatting errors, internal pool software failures, or other technical issues not covered above.

Causes of broken shares:

• Incorrect Data Format: Errors during data generation or processing lead to corrupted share submissions.
• Hardware Failures: Issues such as overheating or unstable power supplies can cause erroneous calculations.
• Software Errors: Bugs or incorrect miner configurations can produce corrupted data, rendering a share invalid. If shares are frequently “dropping,” it may indicate data transmission lags or hardware setup errors, ultimately causing a loss of computational power and reduced profitability.
• Data Transmission Problems: Interruptions or failures in the network infrastructure can corrupt data packets or result in lost information during transmission.

How Do Shares Affect a Miner’s Profits?

Accepted shares register a miner’s contribution to the pool and serve as the basis for reward distribution. The more accepted shares you generate, the larger your portion of the reward. Conversely, outdated, rejected, or broken shares undermine efficiency and thus reduce potential earnings. If your mining setup is producing too few shares, it may point to hardware configuration issues or an unstable connection, requiring optimization to increase the number of valid results.

A Good Ratio of Accepted and Rejected Shares

An optimal acceptance ratio typically ranges from 95% to 100% of submitted shares being approved by the pool. If fewer than 5% of shares are rejected, it generally points to stable hardware and a solid internet connection. However, if a large number of your shares fail to reach the pool, it may indicate configuration problems, network delays, or hardware malfunctions, all of which can significantly impact your mining profitability.

How Do I Calculate the Percentage of Rejected Shares?

To determine the percentage of rejected shares, use the following formula:

(Number of Rejected Shares / Total Number of Shares) × 100%

For instance, if a miner submitted 1000 shares and 50 were rejected, the calculation would be as follows:

1. Calculate the ratio: 50 / 1000 = 0.05
2. Multiply by 100: 0.05 × 100% = 5%.

Thus, the percentage of rejected shares will be 5%.

How to Improve the Share Ratio and Increase Returns?

To improve your share ratio and boost profitability, reducing the number of rejected shares is essential—each error directly impacts performance. Here are a few key steps to achieve this:

• Stable Internet Connection: Ensure a high-quality connection to prevent latency and data loss, which can lead to outdated (stale) shares.
• Optimize Hardware and Software Settings: Regularly update drivers, firmware, and mining software to minimize computation errors on GPU and CPUs, or specialized devices like ASIC miners. Additionally, review your overclocking and power consumption settings to keep your hardware stable and maximize efficiency.
• Choose a Reliable Mining Pool: Select a mining pool with proven infrastructure and minimal latency to reduce the likelihood of shares being lost due to technical issues. Optimizing the pool’s performance also involves setting the appropriate share difficulty so that each miner’s contribution is accurately recorded and rewards are distributed evenly.

• Temperature and Cooling Control: Overheating can lead to hardware errors, so it is crucial to monitor temperature levels and ensure proper cooling measures are in place. 

Regular monitoring of logs and statistics enables prompt detection and resolution of issues, thereby increasing the percentage of accepted shares and boosting mining profitability.

What Is Share Complexity?

Share complexity is the threshold set by the mining pool that a calculated hash must meet to be considered a valid “share.” Typically, this threshold is lower than the network difficulty, allowing miners to validate their work regularly and earn rewards.

What Is the Complexity of the Share For?

Mining difficulty defines the minimum requirements that a computed hash must satisfy to be considered valid proof of work. This mechanism enables the pool to consistently record miners’ contributions—even if the solutions do not meet the full network complexity—and ensures that rewards are distributed fairly.

Network Complexity vs Share Complexity

How Does Complexity Affect Mining Performance?

Mining complexity determines how many computational attempts are required to find a valid hash and directly affects hardware efficiency. As complexity increases, the network requires more computations to discover a new block, slowing down the mining process and reducing the likelihood of earning a reward at an unchanged hashrate. Consequently, hardware upgrades or improved performance may be necessary to maintain or boost returns.

In contrast, the share difficulty in a mining pool sets the threshold at which a calculated hash is considered valid proof of work. An optimal level of share complexity allows for regular recording of miners’ contributions, ensuring a stable distribution of rewards. If share complexity is set too high, miners will receive confirmations less frequently, increasing payout variance; if it is set too low, it can lead to excessive submission of shares, increasing the load on the network and pool. Thus, setting both complexities correctly is key to optimizing the performance and profitability of mining operations.

Why Does the Pool Set the Share Complexity High?

The pool sets the share complexity high to optimize network performance and reduce server load, enabling miners to submit fewer yet more meaningful proofs of work. This approach minimizes obsolete and duplicate shares while ensuring that each participant’s contribution is measured with greater accuracy, ultimately leading to a fairer distribution of rewards.

How Are Rewards Distributed?

Rewards in the pool are distributed in proportion to the number of accepted shares that validate each miner’s contribution to the overall mining process. When a block is found, the pool receives a reward, which is then divided among the participants according to their share of confirmed shares, minus commissions. Depending on the chosen method (e.g., PPS—a fixed payment per share, or PPLNS—payment on the last N shares), the system can incentivize both steady participation and the active accumulation of confirmed results.

Conclusion

To summarize, shares are a critical tool for validating miners’ work. Proper setup and management of shares enable the pool to minimize errors, ensuring that miners receive rewards that accurately reflect their contributions to the mining process.