What is a Coinbase Transaction and Example?

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What is a Coinbase Transaction and Example?

A Coinbase transaction is a specific type of transaction that occurs on the Bitcoin blockchain. It is called a Coinbase transaction because it is the first transaction in a new block, and it is used to create new Bitcoin.

In a Coinbase transaction, a miner is rewarded for solving a complex mathematical problem that verifies transactions on the Bitcoin network. The miner receives a fixed amount of Bitcoin as a reward for their work, and this reward is sent to a new address that they specify. This new address is created by the miner and is known as the “coinbase address,” hence the name “Coinbase transaction.”

The coinbase transaction is also unique because it does not have an input, which means that it does not reference any previous transactions on the blockchain. Instead, it creates new Bitcoin out of thin air and sends it to the miner’s coinbase address.

Here is an example of a Coinbase transaction:

Block height: 681107

Transaction hash: 00000000000000000007d4f4ba4bb17a0d26b4c8b0e39f9ec23e441be1e858d8

In this example, the Coinbase transaction occurred at block height 681107. The transaction hash is a unique identifier that is used to track the transaction on the blockchain.

The Coinbase transaction in this block created 6.25 Bitcoin, which was the block reward at the time. This Bitcoin was sent to the coinbase address of the miner who solved the mathematical problem to verify the transactions in this block.

The coinbase address in this example is:

Address: bc1qrg6e2cj6g0wfrgcxnz0jpsnz6u9tn0rmmd7aqv

This address was created by the miner who solved the problem to verify transactions in this block. The 6.25 Bitcoin created in this transaction was sent to this address as a reward for the miner’s work.

It is important to note that Coinbase transactions are not the same as transactions on the Coinbase exchange. The Coinbase exchange is a popular cryptocurrency exchange that allows users to buy and sell various cryptocurrencies, including Bitcoin. Transactions on the Coinbase exchange are separate from the transactions that occur on the Bitcoin blockchain.

In conclusion, a Coinbase transaction is a unique type of transaction on the Bitcoin blockchain that is used to create new Bitcoin and reward miners for verifying transactions. It occurs at the beginning of a new block and does not reference any previous transactions. While Coinbase transactions are not the same as transactions on the Coinbase exchange, they are an important part of the Bitcoin network and its underlying technology.

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