A mining pool collects work from miners who are too small to mine on their own. In Bitcoin today, this is basically every miner (other than the bigtime dudes w

A mining pool collects work from miners who are too small to mine on their own. In Bitcoin today, this is basically every miner (other than the bigtime dudes who already got ASICs). Time to complete a block is in the years for GPU miners. Put together hundreds of miners at varying rates and collect their work into a pool, now you can afford to pay small miners something even if their work would not approach a single block in the amount of time that you see them. A negative buffer means they've been paying per share the going rate per share (however they've calculated that), and not some other way of calculating that avoids negative buffers (say, dynamically calculating the value of the shares based on how many buffers they touched and how much is in the buffer.) They have missed their projections for too long and they are closing their doors to avoid paying out of pocket, rather than change to a scheme that does not depend so much on the pool's luck.