How Do Transaction Tips Differ from Block Rewards?
Transaction tips (priority fees) are paid directly by the user to the validator to incentivize faster inclusion of their specific transaction. Block rewards are newly minted coins paid by the protocol to the validator for creating the block.
Tips are variable and dependent on user demand, while block rewards are generally fixed or scheduled.
Glossar
Transaction Tips
Execution ⎊ Transaction Tips, within cryptocurrency, options, and derivatives, often center on optimal order routing to minimize slippage and adverse selection, particularly crucial in fragmented markets.
Newly Minted Coins
Genesis ⎊ Newly minted coins, within the cryptocurrency ecosystem, represent the initial supply of a token created through a process like mining or a token generation event.
Rewards
Incentive ⎊ Rewards within cryptocurrency, options trading, and financial derivatives frequently manifest as economic incentives designed to align participant behavior with network or market objectives.
Block Rewards
Principle ⎊ Block Rewards represent the economic incentive distributed to network participants, typically miners or validators, for successfully validating a new block of transactions and appending it to the blockchain ledger.