Block Reward

Definition ∞ A block reward is a payment given to a miner for successfully adding a new block of transactions to a blockchain. This reward incentivizes participants to expend computational resources, thereby securing the network and validating transactions. It comprises newly generated cryptocurrency and any transaction fees included within the block. The block reward is a fundamental component of proof-of-work consensus mechanisms, driving the network’s operational integrity and coin distribution.
Context ∞ Discussions around block rewards frequently involve halving events, which periodically reduce the reward amount to control inflation and scarcity. These events significantly influence mining profitability, network security, and the long-term supply dynamics of digital assets. They often lead to considerable market speculation and adjustments in mining operations.