What is a block reward?
A block reward is a reward granted for completing a block as part of the Bitcoin cryptocurrency. This reward is distributed by the network to the miners who have successfully completed the block.
The token distribution plan was established by Bitcoin inventor Satoshi Nakamoto. The distribution plan is based on defined rules, which are anchored in the Bitcoin blockchain. If you want to change these principles, the entire Bitcoin network must agree.
Bitcoin mining is based on a proof-of-work algorithm, so miners provide computing power and use it to solve mathematical equations. If a block is found in the network, the miners try to calculate a nonce, which corresponds to the current difficulty.
If the calculation is successful, open transactions are verified and the hash function is completed. With the completion of the hash function, the block is also completed and the reward flows to the miner who completed the block.
Due to the current popularity of the Bitcoin token, the difficulty increases enormously. This means that the computing power required to calculate the nonce constantly increases and the personal block reward of the miners tends to decrease.
How much is a block reward worth?
The first token to be mined was worth 50 Bitcoin. This reward was halved when 210,000 tokens had been mined. This meant that the first 210,000 tokens were associated with a reward of 50 Bitcoin for miners.
It should also be noted that 144 blocks are cleared daily. This equates to 1.8 Bitcoin per day. In addition, 16,760,725 tokens are currently in circulation. This equates to approximately 79.81 percent of the available token quantity.
Alexander Weipprecht is the managing partner of Provimedia GmbH. As a trained IT specialist for application development, he has been advising leading companies on the following topics for more than 10 years: online marketing, SEO and software. Cryptocurrency is becoming increasingly important to businesses and investors. Through Coin Report and Krypto Magazin Germany, Alexander wants to give all people easy access to the subject matter.