Coinbase Transaction
A special Bitcoin transaction that creates the block reward and pays it, along with transaction fees, to the miner of a new block.
A coinbase transaction is the first transaction in every Bitcoin block. Unlike normal transactions, it does not spend bitcoin from previous outputs. Instead, it creates new bitcoin according to Bitcoin’s issuance schedule and also collects the transaction fees from all other transactions in that block. The miner who finds the block chooses where this reward is paid, usually to an address they control or to a mining pool payout address.
It matters because the coinbase transaction is how new bitcoin enters circulation and how miners are compensated for securing the network. For example, if a block contains many user transactions with fees, the coinbase transaction pays the miner the fixed block subsidy plus those fees in one output or several outputs. A useful comparison is that regular Bitcoin transactions move existing coins, while a coinbase transaction is the block’s “paycheck” to the miner. Coinbase transaction outputs must mature for 100 blocks before they can be spent, which helps protect the network if a mined block is later replaced.
Other terms in Bitcoin
ASIC
A specialized computer chip built to do one task very efficiently, commonly used in Bitcoin mining to perform hashing calculations.
BTC
The ticker symbol for bitcoin, the native currency of the Bitcoin network.
Bitcoin
A decentralized digital currency and payment network that lets people send value without relying on a bank or central authority.
Block Height
A block height is the number that shows a block’s position in a blockchain, counted from the first block.