Each player who participates in the tournament mode enters the tournament for a specific in-game fee. In tournament mode, you have to win 4 matches to reach the grand prize. You will receive 3 small prizes as a result of 3 matches won until the final match. In order to get the final chest which contains the big prize, you have to win the final match.
The total amount of the prize won will always be higher than the tournament entry fee you paid.