Crypto 101 · Proof of work
Merged Mining Explained: One Miner, Several Coins
Abstract
Merged mining, also called auxiliary proof of work, lets a miner solve one proof of work that is valid for more than one blockchain. Scrypt coins such as Litecoin and Dogecoin can share security this way, and several smaller coins join them. We explain the mechanism, what it changes for miners and for the small chains, and which of Scrypt Wallet's coins can be merge-mined.
Keywords: merged mining, auxiliary proof of work, AuxPoW, Litecoin, Dogecoin, Luckycoin
1. In plain English
Normally a miner picks one coin and spends electricity mining it. Merged mining lets the same work count twice. A miner working on Litecoin can, at no extra electricity cost, also be working on Dogecoin, because Dogecoin agrees to accept Litecoin's proof of work as proof for its own blocks. The miner is paid in both coins.
The benefit flows both ways. Miners earn more per watt. The smaller chain borrows the security of the larger one: an attacker would have to beat the combined hashrate, not just the small chain's own.
2. How it works
The technical name is auxiliary proof of work, or AuxPoW. A child chain's block includes a reference to a parent chain's block header that already met the child's difficulty target, together with a proof that the reference was committed inside that parent block [1]. Dogecoin's source code sets the height from which it accepts auxiliary proof of work, block 371,337, and gives itself a chain identifier so the commitments cannot be confused with other chains [2].
3. Which coins pair up
Both Litecoin and Dogecoin use Scrypt [3, 4], so hashrate mining Litecoin can also mine Dogecoin. Luckycoin also uses auxiliary proof of work and can be merge-mined with them, and mining pools that support merged mining list further Scrypt coins such as Bellscoin and Pepecoin [5].
4. Go deeper: what changes for each side
For miners, the parent chain determines the hardware and the pool; the child chains are extra income. For the child chain, difficulty adjusts to the merged hashrate that chooses to participate, which can vary widely, so a small chain's security depends on the parent's miners staying interested. For holders, merged mining means Dogecoin's security is tied to the Litecoin mining ecosystem's health. These points are also why the two coins appear together in the mining calculator, which counts your power draw once and estimates each coin's reward separately.
5. In Scrypt Wallet
Scrypt Wallet supports Litecoin, Dogecoin, Luckycoin, Bellscoin and Pepecoin natively, so one wallet can receive payouts from a merged-mining pool in every coin. See the Litecoin and Dogecoin pages for live network data.
References
- Bitcoin Wiki contributors (2011). Merged mining specification. Bitcoin Wiki: how one proof of work can secure more than one chain (auxiliary proof of work). https://en.bitcoin.it/wiki/Merged_mining_specification
- Dogecoin Core developers (2013). chainparams.cpp. Dogecoin Core source code: 60-second target spacing; AuxPoW (merged mining) effective from block 371,337. https://github.com/dogecoin/dogecoin/blob/master/src/chainparams.cpp
- Lee, C. (coblee) (2011). [ANN] Litecoin - a lite version of Bitcoin. Launched!. Announcement thread, Bitcointalk, 9 October 2011. https://bitcointalk.org/index.php?topic=47417.0
- Dogecoin Core developers (2013). Dogecoin Core. Repository and README: Dogecoin's use of the Scrypt hashing method for proof of work. https://github.com/dogecoin/dogecoin
- ViaBTC (2023). What is Luckycoin (LKY)? How to Mine Luckycoin (LKY). Mining-pool explainer: Luckycoin is a Scrypt proof-of-work coin, launched in 2013, that uses AuxPoW to be merge-mined with Litecoin and Dogecoin; the pool supports merged mining for LTC, DOGE, BELLS, LKY and PEP. https://www.viabtc.com/en/blog/what-is-luckycoin-lky-how-to-mine-luckycoin-lky-368
Common questions
Does merged mining cost extra electricity?
No. The same hashing work counts for both chains, so power is used once while rewards can arrive in more than one coin.
Which coins can be merge-mined together?
Scrypt coins that support auxiliary proof of work, including Litecoin as the parent chain and Dogecoin, Luckycoin, Bellscoin and Pepecoin as child chains on pools that support them.
General education, not financial, tax or legal advice. Figures are schematic. Protocol parameters are cited to primary sources and can change; verify against the linked source before relying on them.