Economic Model

The economic incentives defined by the protocol

The protocol defines an economic system: a native token, a fixed issuance schedule, and a proof-of-work incentive that rewards nodes for extending the chain. This page summarises the parts of that model that are fixed by consensus rules. The rules themselves are specified on the Consensus Rules page.

Native token and supply

The native token is BSV. Its indivisible unit is the satoshi; 1 BSV = 10⁸ satoshis. Total issuance is capped at 21,000,000 BSV (2.1 × 10¹⁵ satoshis), distributed entirely through block subsidies. The cap is a consequence of the block-subsidy schedule below and is not separately configurable.

Block subsidy

New coins enter circulation through the coinbase transaction of each block. The subsidy (GetBlockSubsidy) starts at 50 BSV per block and halves every 210,000 blocks (approximately every four years), reaching zero after 64 halvings. A coinbase may claim at most the subsidy plus the total fees of the transactions in the block; a block that claims more is invalid (bad-cb-amount). See Consensus Rules.

As the subsidy diminishes, transaction fees become the primary incentive for nodes to include transactions and extend the chain.

Proof of work as an incentive

Proof of work requires nodes to expend computation (and therefore energy and capital) to produce a valid block. A node that produces a block earns its subsidy and fees only if other nodes accept the block and build on it, which they do only if it satisfies the consensus rules. This ties a node's reward to rule-compliant behaviour. The difficulty-adjustment algorithm targets a fixed average block interval regardless of how much computation the network applies; see Proof of Work and Blocks.