Miner subsidy

Revision as of 02:43, 4 November 2020 by Brendan (talk | contribs)
(diff) ← Older revision | Latest revision (diff) | Newer revision → (diff)

The Miner subsidy is the means by which all tokens on the network are initially distributed. The subsidy is paid to compensate early Miners for the lack of Transaction fees being paid by users of the network.

For the first 210,000 blocks successful Miners can claim a subsidy of 50 bitcoins, however after each subsequent 210,000 blocks, the subsidy drops by half, eventually falling to zero after 32 'Halving' cycles.

The Miner subsidy was never intended to be the primary income mechanism for Miners, but instead was a means to both bootstrap investment in the network and to broadly distribute the currency units in a fair and transparent manner.