Tutorial on merged mining Litecoin / Dogecoin and other Scrypt Coins
Not to be confused with multipool mining, which switches to a more profitable coin automatically, merged mining lets you send hashes to numerous blockchains. That would mean that while mining Litecoin or Dogecoin, you would be able to mine other cryptocurrencies at the same time, as you no longer need to choose inbetween mining one or the other coin. Mining would be more profitable by mining a primary coin and other secondary coins without affecting your maximum hashrate on the primary coin, and power consumption remains the same.
Merged mining works like this, your generated hashes that could be the solution to the current block will be sent to two or more different blockchains to see if they are the solution. Since every blockchain which represents a coin would have a different solution, you are enlargening your chances of solving a block by sending the hash to numerous blockchains. The data of both coins remain totally separate, you are merely running numerous clients on the same machine and submit the hashes to numerous networks. If your hash is the solution to a particular block, you will get the coin. It would be the same as if you are mining with a single cryptocurrency, except that instead of submitting your work to a single network, you are submitting your work to numerous networks to increase your chances of solving a block.
The most common of merged mining will be the merged mining of Bitcoin and Namecoin. As Namecoin is a clone of Bitcoin, using the SHA-256 algorithm, a single hash of work could be used to solve a block on either coin. In theory, a miner would not even know if his pool is doing merged mining, as the same hash sent for solving the Bitcoin block could be sent to the blockchain of Namecoin as well. Thus in theory, a pool operator can keep the profit to himself if he wishes to. But that is ot our topic of discussion for today. I will showcase you a elementary tutorial on how to begin merged mining on Scrypt-based coins.
Merged Mining on Numerous Scrypt-based Coins
Step 1: Coin selection for merged mining
There would be primary coins and secondary coins to choose from. Like the merged mining example above, Bitcoin is the primary coin and Namecoin would be the secondary coin. You will need to choose one primary coin to mine with and you would have equal hashing power on all the secondary coins. No doubt it is also possible to choose more than one primary coin, but your hashing power would be divided among the number of primary coins.
So let’s just stick with one primary coin and take all the secondary coins for merged mining.