Miner Fee

Miner Fees are another name for transaction fees that a blockchain network charges to execute and validate transactions on the blockchain network of choice.

Miners are incentivized to do the work of verifying transactions, confirming transactions, and then adding those transactions to a new block, which is then added to the blockchain.

The miners receive their reward in the form of cryptocurrency like Bitcoin (BTC) for completing complex and expensive cryptographic problems faster than the next miner.

Users of the blockchain, which includes individuals, businesses, and even crypto exchanges, pay the transaction fees that the winning miner eventually gets.

See Transaction Fee for more info.

Related Terms

Network Fee

A fee you pay to a blockchain network for transferring a digital asset on that network. The fees go to the miners or validators of that blockchain network who win the right or are chosen by the validation mechanism to ultimately confirm your transactions and add to the blockchain.

Transaction Fee

Fees charged by a blockchain network to execute and validate transactions on that blockchain network. Fees are used to incentivize miners to complete complex and expensive cryptographic problems to validate transaction blocks to the leger of a blockchain.

Bitcoin (BTC)

Bitcoin (BTC) is most well known as a digital decentralized cryptocurrency, without a central bank or single administrator, that can be sent from user to user on the peer-to-peer Bitcoin network without the need for intermediaries, such as payment gateways or banks or routing services. Think of bitcoin as Internet money, that you can send and receive directly, to and from anyone, and you can use it to pay for stuff.

Blockchain

Blockchain networks are at the heart of cryptocurrencies. A blockchain is a database, or digital ledger, made up of a series of interconnected blocks containing transaction data created on the network over some period of time. Each block in a blockchain also contains a unique identifier unlike any other block in the chain called a hash. Think of the hash as a fingerprint identifying that block for all other blocks. Distributed ledger technology (DLT) is another name frequently used in relation to blockchains.

Block Reward

Incentives or prizes given to miners after they use their computing resources to successfully validate a new block of transactions and add them to the blockchain.