Remember from last lecture that pay-per-share schemes will pay you a fixed amount of money for each share, or near-valid block.
This payment is guaranteed and constant per share, regardless of how much reward the pool makes.
One issue is that there’s no incentive for a miner to actually submit valid blocks to the pool because the amount of revenue collected from that share is equal to any other share.
So miners will stop doing work on their current block as soon as it satisfies the near-valid block requirements.
Proportional schemes are the other category which pay out only when a block is found.
The reward of each miner is proportional to the number of shares submitted before the block was found.
However, this scheme is disadvantageous for the miner because the miner now has to bear the risk of not finding a block, and therefore the variance of rewards.
They only get paid when a valid block is found by the pool.
For the same reason, proportional pay-out schemes are beneficial to the pool, since they only have to pay miners when a valid block is found.
Given the incentive structures in both pay per share and proportional pool pay-out schemes, is it possible that pools are vulnerable to some incentive misalignment?