By the end, you’ll be able to…
- Separate subsidy and transaction fees.
- Explain why scarcity does not determine demand.
Three questions to carry into this lesson.
The coinbase transaction has a special role
A block’s coinbase transaction can claim the permitted subsidy and included transaction fees under consensus rules. The subsidy follows Bitcoin’s issuance schedule and decreases at defined block heights. Ordinary users cannot create the same privilege by labeling a transaction as a reward. Nodes validate the allowed amounts as part of block acceptance.
Incentives are an argument, not magic
The whitepaper discusses why miners may prefer following the rules to attacking the system. Real participants still face hardware, energy and market conditions. A rule can constrain issuance while economic behavior remains uncertain. Avoid treating a halving as a timetable for prices or assuming that a smaller subsidy alone tells the full future security story.
Keep community rewards separate
If a kitchen grant is paid in sats, those sats come from an existing approved budget. They are not newly mined because a volunteer submitted evidence. A service-review process and Bitcoin issuance operate at different layers. In educational reports, distinguish mined issuance, transfers, trading gains, donations and borrowing. Calling all incoming funds rewards can hide both the source and the obligation attached to them.
Practice on paper
A fictional block permits a 10-unit subsidy and contains 2 units in fees. A miner claims 13. What should a validating node conclude in this simplified example?
I’ve tried it — show the worked answer
The claim exceeds the allowed total of 12 and is invalid. The example uses invented units to teach the accounting rule, not current Bitcoin subsidy values.
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One idea to take with you
Know the monetary rule and keep economic predictions distinct.
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