We were recently asked:
I have a question: why is our hashrate stuck between 30 to 50 Mh/s for 6 months??? More miners more involvement in coin. Only previous miners no new are are coming any group or anything?
This line of thought misses something critical about hashrate and pools - the purpose of the Difficulty Adjustment Algorithm is to ensure that the average block time is 10 minutes. This is the critical and fundamental goal of the system, and leads to a self-balancing effect.
If more people joined the pool, block time would become too small (more mining power means blocks are found more quickly), and the DAA would need to increase the difficulty to slow it down… the overall profitability would then be lower, and many miners (who choose their coin based on profit) would leave for another coin - bringing the block time back to the 10-minute target, and returning the pool size to where it was.
On the other hand, if more people leave the pool, block time would become too large, and the DAA would decrease the difficulty to speed it up… the overall profitability would then be higher and many miners would join because it’s more profitable than other coins - bringing the block time back to the target, and returning the pool size to where it is.
The hash pool reaches a natural balance point, relative to the other GPU-mined coins. The thing that changes that balance point is the profitability… if BTG rises in price relative to the other GPU-mined coins, the profitability brings more miners. And if BTG rises relative to others, some miners leave. It’s always about balance.
Note that if BTG rises, but the other GPU-minable coins rise in EQUAL degree, then there is no change in pool sizes; it’s about the ratio.
If more people take up GPU mining, the overall numbers grow for all coins; the DAAs cause the new miners to be balanced among the current coins.
TL;DR: it’s a mistake to think that the pool size is an indicator of support; because many (most?) miners choose their coin based on highest profit, the pools size will tend to assume a balance point relative to the profitability of mining each coins.