MSPs play a crucial role by estimating the hashrate produced by their affiliated miners and subsequently creating Deferred Payment Contracts (DLCs) for them. These contracts ensure that miners are compensated upfront for their computational contributions, with the condition that they meet the agreed upon hashrate by the time the contract expires. The payment process involves MSPs disbursing a predetermined amount of Bitcoin to each miner, which is calculated based on the expected inflow of funds from mining pools like Radpool's Pay-Per-Last-N-Shares (PPLNS) system. However, this model introduces a financial risk for MSPs since they pay out miners before receiving any actual payout from the pool. To mitigate this risk and ensure profitability, MSPs adjust the payment to miners to be slightly less than the anticipated return from the pool, effectively creating a margin or "fee" that compensates them for their risk.

Radpool's attempt to decentralize Fixed Pay Per Share (FPPS) through this model highlights a shift towards minimizing central authority control in mining operations. The described mathematical model emphasizes deterministic outflows to miners against the stochastic nature of pool rewards, aiming to provide MSPs with a framework to calculate a safe hashrate commitment that balances their BTC outlay with an acceptable rate of return.

Furthermore, the concept of zero fees for miners is introduced as a theoretical advantage for miners who also operate as their own MSP. In this scenario, miners can essentially bypass traditional fee structures by self-financing their operations. The difference between the inflow from the pool and the outflow to themselves remains within their control, allowing them to mine without incurring conventional fees, provided they have the necessary capital upfront. This self-sustaining setup challenges the existing centralized FPPS systems and proposes a more autonomous and potentially cost-effective mining solution.

Lastly, the author expresses openness to sharing the MSP risk model for further review, indicating a collaborative effort toward refining and adopting this decentralized payout mechanism within the Bitcoin mining ecosystem.