Where does the 25BTC come from?

[konradp]

Hi.

OK, so when a miner or pool (do we simply call them "nodes"?) solves a block, it is rewarded with 25BTC (currently). But where does it come from? I understand a transaction is created as a reward, for the pool/miner's address, but who/what exactly does this and who confirms this if anybody?

[Cubic Earth]

The block reward is created out of thin air.  It does not 'come from' anywhere.   Bitcoins are bitcoins by communal agreement.  They are an emergent property of a consensus system.

Anyone can create a block and you can award yourself any type of award you want.  But unless your block conforms to all of the relevant rules - including a hash of appropriate difficulty and a correctly sized bitcoin award, it will neither be propagated around the network nor appended on to the blockchain.  If you block does not become part of the blockchain, no one is going to recognize it nor the award you gave yourself.

[konradp]

OK, I think I get it - I am the one who creates a transaction for me myself, and as soon as the block is confirmed, all the transactions in the block (including the one I created) are confirmed and are put into blockchain, yes?

[TierNolan]

OK, I think I get it - I am the one who creates a transaction for me myself, and as soon as the block is confirmed, all the transactions in the block (including the one I created) are confirmed and are put into blockchain, yes?

Right, the first transaction in the block is called the coinbase transaction.  Unlike all other transactions, it doesn't have any inputs. 

The rule is that the sum of the outputs of a transaction cannot be greater than the sum of the inputs, but that rule doesn't apply to the coinbase transaction.

The sum of all transaction outputs in the block cannot be greater than the sum of all the inputs in the block plus the 25 BTC mint reward.  This means that if a transaction doesn't transfer all of its input value to its outputs, then that can also be added to the coinbase transaction's payout, as a fee.

You don't have to take the mint reward or fees.  A coinbase which pays zero would also be valid.

[konradp]

OK, thank you guys!