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Crypto Dictionary

Block Reward

Definition

The amount of cryptocurrency that a miner receives for successfully mining a block.

Deep Dive

A block reward is the incentive granted to a miner or validator for successfully adding a new block of verified transactions to a blockchain. This reward typically consists of newly minted cryptocurrency (often referred to as the "coinbase reward") and any transaction fees associated with the transactions included in that block. It serves as the primary economic motivator for participants to dedicate resources – whether computational power in Proof-of-Work or staked capital in Proof-of-Stake – to secure the network and process transactions.

Examples & Use Cases

  • 1Bitcoin's current ~6.25 BTC block reward plus transaction fees
  • 2Litecoin's block reward of 12.5 LTC plus transaction fees
  • 3Ethereum validators earning ETH rewards for proposing and attesting to blocks.

Related Terms

Transaction FeesHalvingMiningIncentive Mechanism

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