Glossary / Transactions & fees
Coinbase
- Definition
- The coinbase is the free-form field inside a mining reward transaction where the miner writes arbitrary bytes, and it has nothing to do with Coinbase the exchange.
Specified in BIP-34.
Two unrelated things share this name. The protocol field is 2 to 100 bytes of space in the block reward transaction, used since 2009 for block heights, pool names, and the occasional message; the company was founded in June 2012 and borrowed the word. Support articles and tax forms almost always mean the company.
How it works
The coinbase field sits where an ordinary input would carry its unlocking script, and because that script is never executed, consensus places almost no rules on what goes in it.
Two rules exist. The field must be at least 2 bytes and no more than 100 bytes, a limit Bitcoin Core checks before it looks at anything else in the block, and since BIP34 the first bytes must encode the height of the block being mined. Everything after that belongs to whoever found the block.
Miners fill the rest for four reasons.
Extra nonce space. The nonce in the block header is 32 bits, so a mining farm exhausts all 4,294,967,296 values almost instantly. Changing a byte in the coinbase field changes the coinbase transaction, which changes the merkle root in the header, which hands the machines a completely fresh search space. The Stratum protocol formalizes this: the pool assigns one slice of the field and the miner rolls the other.
Attribution. Pools write a tag such as /Foundry USA Pool/ or /AntPool/, and block explorers read those strings to label who mined what. This is a convention with nothing enforcing it. A pool can write any tag it likes, or none at all, so published pool market share figures rest on self-reporting.
Signalling. Before soft forks moved to the version bits in the block header, miners voted with text here. BIP16 asked supporting miners to include /P2SH/, and pay-to-script-hash switched on for the whole network on April 1, 2012 once enough blocks carried it.
Messages. Block 0 carries a newspaper headline about a bank bailout, which is why people still open the field expecting to find something. Most of the time they find a pool name and a counter.
Where you see it
Block explorers decode the coinbase on every block page, usually printing both the raw hexadecimal and whatever readable text can be pulled out of it.
That is the only place it appears. The field is not searchable from your wallet, it does not follow the coins that later reach you, and it never affects whether a payment is valid. If you are reading one, you are either checking who mined a block or hunting for a message somebody claims is in there.
Coinbase the field vs Coinbase the exchange
The field is part of bitcoin's 2009 design; the company is an American exchange that went public on Nasdaq in April 2021 and took its name from the term nine years earlier. Nothing on a Coinbase account statement refers to this field. When a tax tool, a support ticket, or a news article uses the word, assume it means the company unless the sentence is plainly about mining.
Coinbase vs coinbase block height
The coinbase is the whole field, up to 100 bytes of it; the coinbase block height is only the mandatory prefix at the front. Everything a miner chooses to write comes after that prefix, and the prefix is the single part of the field that a node actually validates.