The Mempool and Transaction Fees Explained: How Fees End Up in a Solo Block

The Mempool and Transaction Fees Explained: How Fees End Up in a Solo Block

When people talk about the Bitcoin block reward, they usually mean the subsidy — the new coins created with every block. But every block reward has a second part that changes from block to block: the transaction fees. Where those fees come from, how they get picked, and why they vary is the story of the mempool. For a solo miner it is worth understanding, because if your Bitaxe ever finds a block, the fees inside it are part of what the coinbase transaction pays out.

The mempool is the set of valid, unconfirmed transactions a Bitcoin node is holding while they wait for a block. There is no single global mempool — every node keeps its own. Each transaction pays a fee equal to its inputs minus its outputs, and what matters for getting into a block is the feerate: fee per unit of block space, expressed in sat/vB. Block space is limited (block weight is capped at 4 million weight units), so block templates typically favour higher-feerate transactions. When a block is found, its coinbase transaction pays the subsidy plus all the fees of the transactions inside. Network transaction fees are not the same as Bitmern Solo's flat 1% pool fee on finds. On Bitmern Solo, keep BTC easy-start host btc.bitmernsolo.com with port :3132 (never treat :3102 as the Bitaxe / home default), username WALLET.worker, password x. Current Effort is not a find guarantee.

This is the "where do the fees in a block come from" lane. For the reward transaction itself, read the coinbase transaction explained. For how a pool turns chosen transactions into miner work, read block templates and the merkle root explained. For the subsidy side, read the halving explained.

Bitmern Solo is solo infrastructure: flat 1% fee on finds only, you keep 99%. Nothing in this post is financial advice, and nothing here promises a find.

The one-sentence version

Transactions wait in the mempool, miners fill limited block space with them, and the fees become part of the finder's reward.

What the mempool is

"Mempool" is short for memory pool. When someone broadcasts a Bitcoin transaction, nodes check it against the rules — valid signatures, inputs that exist and are unspent, no double spend — and, if it passes, they keep it in memory and pass it on to their peers. That waiting area is the mempool.

Three things are worth knowing:

1. Every node has its own mempool. There is no central queue. Nodes see transactions at slightly different times and may apply slightly different local policies, so two mempools are rarely identical.
2. Transactions in the mempool are unconfirmed. They are not part of the blockchain yet. A transaction is confirmed when it is included in a block.
3. The mempool changes constantly. New transactions arrive, and when a block is found its transactions are removed from everyone's mempool.

When a public explorer shows "the mempool", it is showing one node's view (or a combined view). That is useful, but it is a view — not an official global list.

What a transaction fee is

A Bitcoin transaction spends inputs (earlier outputs) and creates new outputs. There is no "fee field". The fee is simply what is left over:

fee = sum of inputs − sum of outputs

Whoever builds the transaction decides the fee by deciding how much to leave unassigned. Whoever finds the block that includes it collects that leftover through the coinbase transaction.

Why feerate matters more than the fee

Block space is the scarce resource. A block's size is limited by weight, capped at 4 million weight units. Larger transactions — more inputs, more outputs, more data — take more of that space.

So what matters is not the total fee, but the fee per unit of space: the feerate. It is usually written in sat/vB (satoshis per virtual byte). A virtual byte is a way of expressing weight in byte-like units.

EXAMPLE ONLY — placeholder values
Tx A: fee = F_A, size = S_A vB   -> feerate = F_A / S_A
Tx B: fee = F_B, size = S_B vB   -> feerate = F_B / S_B
A larger total fee can still be a lower feerate if the transaction is much bigger.

How a block template picks transactions

When a pool's node builds a block template, it wants to fill the limited space with the transactions that pay best for that space. In broad terms:

1. Sort by feerate. Higher sat/vB transactions are considered first.
2. Respect dependencies. A transaction that spends an output from another unconfirmed transaction can only go in if its parent is included too. Nodes look at these as packages — this is why "child pays for parent" (CPFP) works: a high-fee child can pull a low-fee parent into the block.
3. Stop when the block is full. Whatever does not fit keeps waiting in the mempool.

Transactions that signal replaceability can also be replaced by a higher-fee version before they confirm — known as replace-by-fee (RBF). Either way, the result is the same: the template ends up holding a set of transactions, and their combined fees go into the coinbase. How the pool turns that template into jobs for your miner is covered in block templates and the merkle root explained.

Why fees vary from block to block

Because demand for block space changes. When many people want to transact at once, they compete for the same limited space and feerates rise. When demand is quiet, lower feerates are enough.

That means the fee part of a block reward is not fixed. Two blocks found on the same day can carry very different fee totals. This post will not state any current feerate or fee total — those change constantly. If you are curious, open a public mempool explorer and look at the live view.

How fees reach a solo finder

Every block starts with the coinbase transaction. It pays out:

1. The subsidy — currently 3.125 BTC per block since the April 2024 halving.
2. The fees — the total fees of every transaction included in that block.

EXAMPLE ONLY — symbolic
block reward = subsidy + Σ(fees of included transactions)
             = 3.125 BTC + F    (F varies with each block's contents)

In solo mining, if a hash from your Bitaxe ever meets the network target, the block found is the one your shares were attributed to, and the reward is paid toward your WALLET.worker payout wallet. Bitmern Solo charges its flat 1% on finds, so you keep 99%. For how payouts and timing work, read payout timing and verify a payout on an explorer.

Network fees vs the Bitmern Solo fee

These two get confused, so it is worth being blunt:

1. Network transaction fees are paid by people sending Bitcoin transactions. They go to whoever finds the block that includes those transactions.
2. The Bitmern Solo fee is a flat 1% of a find. It is how the pool is paid. You keep 99%.

They are unrelated. Network fee levels do not change the Bitmern Solo percentage. More detail in Bitmern Solo fees: 1%.

Why fees do not change your odds

Fees change the size of a block reward, not the chance of finding one. Your chance of finding any given block comes from your hashrate compared with the network's, against the current difficulty. Whether the block in progress carries a lot of fees or very few, your Bitaxe searches exactly the same way.

That is also why solo results are lumpy. Read solo mining variance for the character of it.

Ordered "fees and my solo setup" checklist

1. Confirm the stratum fields

Symptom: You want to be sure your work is attributed to your wallet.

Fix: In AxeOS, check the stratum settings. Host:

btc.bitmernsolo.com

Port:

3132

Username:

WALLET.worker

Password:

x

Never treat :3102 as the Bitaxe / home default.

2. Make sure the wallet part is correct

Symptom: You are not sure the address in WALLET.worker is the one you want paid.

Fix: The wallet part of the username is where a find is credited. Double-check it in your Bitmern Solo account and in AxeOS. If you need to change it, follow change payout wallet.

3. Confirm shares are accepted

Symptom: You want proof your miner is working on current templates.

Fix: Open the matching coin tab on Bitmern Solo and look for fresh accepted shares under your worker. That means jobs — built from templates full of mempool transactions — are reaching your Bitaxe.

4. Look at a live mempool explorer, not a blog, for fee levels

Symptom: You want to know what fees a block would carry right now.

Fix: Check a public mempool explorer. Fee levels change by the minute; no static number is reliable.

5. Do not chase "high-fee periods"

Symptom: You think about running your miner only when fees are high.

Fix: Each hash is an independent chance regardless of fees. Stable uptime matters more than timing. This is not financial advice.

6. Read Current Effort correctly

Symptom: Current Effort is high and you think a big-fee block must be close.

Fix: Current Effort is not a find guarantee — read Current Effort explained.

7. Know how to check a find

Symptom: You wonder how you would see the fees in a block you found.

Fix: On a public explorer, open the block and look at the coinbase transaction: its output is subsidy plus fees. Read what happens when you find a block.

A worked example of a transaction's journey (EXAMPLE values only)

EXAMPLE ONLY — placeholder values
user        broadcasts Tx with fee F at feerate R sat/vB
nodes       validate Tx -> add to their own mempools -> relay to peers
pool node   builds template: sorts by feerate, includes Tx (fits within weight limit)
pool        coinbase pays subsidy + (F + fees of all other included txs)
pool -> miner   new stratum job built from that template
miner       hashes headers; one hash meets network target (rare)
network     block accepted -> Tx confirmed -> removed from mempools
finder      coinbase reward (subsidy + fees) credited per pool payout rules

What this post will not invent

• No current feerates, mempool sizes, or fee totals
• No price, profitability, or ROI figures — no financial advice
• No claims about Bitmern Solo's internal transaction selection
• No claim that :3102 is the home Bitaxe default (easy-start is :3132)

Common mempool and fee misunderstandings

1. "There is one official mempool." Every node has its own.
2. "The biggest fee always goes first." Feerate (sat/vB) matters, not the total fee.
3. "Fees are paid to the pool." Network fees go to the block finder through the coinbase. The pool fee on Bitmern Solo is a separate flat 1%.
4. "High fees improve my odds." They change reward size, not your chance of finding a block.
5. "An unconfirmed transaction is lost." It waits in mempools until included, replaced, or eventually dropped by node policy.
6. "High Current Effort means a block is coming." It does not. Current Effort is not a find guarantee.

Soft next step

Open AxeOS and confirm the stratum fields above, with the wallet you want paid in WALLET.worker. Then open the matching coin tab on Bitmern Solo and watch accepted shares arrive. Every job your miner works on is a template full of mempool transactions — and if one of your hashes ever wins, their fees ride along with the subsidy. Keep BTC easy-start btc.bitmernsolo.com with port :3132 and password x.

Start mining

Start Mining — after login, open the matching coin tab and confirm workers / shares / hashrate.

FAQ

What is the Bitcoin mempool?

Each node's set of valid, unconfirmed transactions waiting to be included in a block. There is no single global mempool.

How is a Bitcoin transaction fee calculated?

Fee = sum of inputs − sum of outputs. The leftover goes to the miner who includes the transaction in a block.

What does sat/vB mean?

Satoshis per virtual byte — the feerate. It measures how much a transaction pays per unit of block space.

How do fees reach a solo miner?

Through the coinbase transaction of a found block, which pays the subsidy plus the fees of all included transactions.

Is the Bitmern Solo 1% fee a network fee?

No. It is a flat 1% pool fee on finds — you keep 99%. Network fees are paid by transaction senders.

Does Current Effort mean I am about to find a block?

No. Current Effort is an ops / attribution signal — not a find guarantee. See Current Effort explained.