Block Reward

A block reward is the payment a miner or validator receives for successfully adding a new block to a blockchain. It is the main incentive that keeps a network secure.

How it works

The reward usually has two parts: newly issued coins (the “subsidy”) and the transaction fees paid by users whose transactions are in the block. On proof-of-work chains the reward goes to the miner who solves the block; on proof-of-stake chains it goes to the chosen validator. On many networks the subsidy shrinks over time — on Bitcoin it halves at fixed intervals.

Why it matters

Block rewards are how new coins enter circulation and how networks pay for their own security. As the issued portion declines on capped-supply chains, transaction fees are expected to make up a larger share of the reward over time.

Example

When a miner adds a Bitcoin block, they receive the current coin subsidy plus the fees from the transactions it contains.

Block Reward: Frequently Asked Questions

What is a block reward made of?

The reward usually has two parts: newly issued coins, called the subsidy, and the transaction fees paid by users whose transactions are included in the block. On proof-of-work chains the reward goes to the miner who solves the block; on proof-of-stake chains it goes to the chosen validator.

Why do block rewards matter for network security?

Block rewards are how networks pay for their own security. They give miners or validators a financial incentive to do the work of adding valid blocks honestly, rather than attacking the chain. Without this reward, there would be far less reason to commit the computing power or staked capital that protects the network.

Do block rewards last forever?

The issued portion does not necessarily. On many networks the subsidy shrinks over time; on Bitcoin it halves at fixed intervals toward zero. As the newly issued share declines on capped-supply chains, transaction fees are expected to make up a larger part of the total reward to keep securing the network.

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