One-Sentence Definition
The block reward is the amount of new cryptocurrency that gets created and paid to the miner who successfully mines a block, combining newly minted coins with transaction fees.
Why It Matters for Solo Mining
As a solo miner, the block reward is literally your entire paycheck—it’s what you’re trying to win every time you mine. Unlike pool miners who get small, frequent payouts, solo miners get nothing until they hit a block, then they receive the entire block reward at once. This makes understanding block rewards crucial because it determines whether solo mining a particular cryptocurrency is even worth your electricity costs.
How It Works
The block reward has two parts: the subsidy (brand new coins created out of thin air) and the transaction fees from all transactions in that block. The subsidy follows a predetermined schedule—for Bitcoin, it started at 50 BTC per block in 2009 and halves approximately every four years (currently 3.125 BTC after the 2026 halving). This is coded into the protocol and enforced by every full node on the network.
When you successfully mine a block, you create a special coinbase transaction that pays the block reward to your own wallet address. This transaction doesn’t have any inputs (because the coins are newly created), and it’s the first transaction in every block. The network validates that you didn’t pay yourself too much—if you try to claim more than the allowed block reward, every node will reject your block as invalid.
Example
Right now on Bitcoin, if you solo mine a block, you’d receive 3.125 BTC (the subsidy) plus maybe 0.1-0.5 BTC in transaction fees, depending on how busy the mempool is. So your total block reward might be around 3.5 BTC—worth about $150,000 at current prices. For Litecoin, the current block reward is 6.25 LTC per block. Each cryptocurrency has its own reward schedule and halving timeline.