Mining Reward

What Is a Mining Reward?

A mining reward is a reward given to cryptocurrency miners as compensation for validating blocks. Typically, this reward is a fixed amount of cryptocurrency. However, depending on the coin, the mining reward may gradually decrease as the total circulating supply of the specific coin increases. 

For example, the current reward for mining one block on the Bitcoin network is 6.25 BTC. This amount is subject to change by the halving events that occur roughly every four years until all 21 million bitcoins have been mined. 

Mining rewards are not only for Bitcoin miners, however. Other cryptocurrencies with similar forms of consensus mechanisms, such as Litecoin, Bitcoin SV, and Bitcoin Cash, have their respective methods of rewarding miners. 

Key Takeaway

A mining reward, otherwise referred to as a block reward, is a newly minted cryptocurrency given to a miner who successfully mines a new block on a blockchain.

Related Words