Every bitcoin transaction from around the world must be validated prior to being added to the bitcoin blockchain. Bitcoin miners process transactions and record these transactions in the bitcoin blockchain. Bitcoin miners create new “blocks” on the blockchain approximately every 10 minutes and are rewarded for creating blocks through transaction fees.

Every block a miner adds to the blockchain comes with a 6.25 BTC “block reward” as well as all fees sent with the transactions that were included in that block.

Step 1:

Someone creates a transaction and offers a fee to bitcoin miners in exchange for validating their transaction

Step 2:

The transaction is broadcast to peer-to-peer computers known as nodes

Step 3:

Miners, or a network of nodes, validate the transaction and the user's status using known algorithms

Step 4:

Once verified the transactions are consolidated to form a data block

Step 5:

The new block is added to an existing blockchain in a way that is permanent and unalterable

Step 6:

The transaction is verified and 6.25 bitcoin + transaction fees are awarded for solving the block