For those of you who have just jumped into the world of crypto, you must have heard the term gas fee When conducting transactions on the Ethereum network. But, what is that gas fee Actually? In this article, we will thoroughly gas feefactors that influence it, as well as tips on saving costs so that your transactions are more efficient.
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What’s that Gas fee?
Gas fee is the cost that users must pay every time they do activities on the Ethereum network. This activity can be in the form of sending ETH, exchanging token, buying NFT, or using a decentralized application (DAPPS) that runs with Smart Contract.
Why do you have to pay? Because every activity in Ethereum requires computing power from thousands of computers (called node) which keeps the network running. Now, gas fee This is a form of reward for the node so that they want to process your transaction.
What do you pay for? Gas fee Paid using ETH, which is the original currency of Ethereum. But, the amount is usually displayed in a smaller unit named GWEI. One GWEI equivalent to one billion a fraction of ETH. For example: 50 GWEI = 0.000000050 ETH.
Gas fee the value can go up and down, depending on two main things:
- How severe your transaction: the more complicated transactions such as interacting with Smart Contractthe greater the gas needed.
- How crowded traffic on the Ethereum network: If the network is crowded, for example when there is Hype NFT or new token release, cost gas can surge. But if it’s quiet, the cost can be very cheap.
In other words, gas fee It’s like a “road cost” for your transaction to the destination. The difference, this cost is not fixed, can change depending on the condition of the road (network) and the default burden (type of transaction).
How to work Gas fee In Ethereum?
After understanding what it is gas feeyou also need to know how this mechanism works. Imagine you are running a computer program, every instruction in the program needs energy to be processed. In Ethereum, the energy is called gas.
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1. Gas = Computational power
Every transaction in Ethereum, whether it’s just sending ETH, exchange token, or execution Smart Contract requires a certain amount of gas. The more complicated the transaction, the greater the amount of gas needed.
Example:
- Sending an ordinary Eth may only need 21,000 gas.
- But if you use the defi application or buy NFT, the gas can be much bigger because the transaction is complex.
2. Basic formula Gas fee
Gas fee calculated by the formula:
Gas fee = Used gas × Gas price
- Used gas It is how much gas your transaction needs.
- Gas price is the price for each gas unit, usually calculated in GWEI (1 GWEI = 0.000000001 ETH). This price can change depending on whether or not the Ethereum network.
If the network is solid, Gas price go on. If it’s quiet, the price goes down. So, even though the amount gas What is needed remains, the total cost you pay can be different.
3. New Cost Structure: Base Fee + Priority Fee
Since upgrade london hard fork (2021), Ethereum has a new system for gas fee:
- Base fee: The minimum costs are determined automatically by the network. This must be paid so that your transaction is included in the block. Later, base fee This Diburn alias removed from circulation, not entering the bag validator.
- Priority Fee (aka tip): this is an additional cost that is optional. You can give tips to validator So that they process your transactions faster, especially when the network is crowded.
With this system, the costs become more transparent and users can have more control to regulate how quickly they want to be transacted.
How to save gas fee in ethereum
Gas fee The high is often the main problem of Ethereum users, especially when the network is busy. But calm, there are some strategies you can do to reduce this cost without sacrificing transaction security.
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1. Transaction when the network is quiet
The transaction time is very influential on the magnitude gas fee. When activities in the network are low, usually in the early morning global time or weekend, gas costs can be much cheaper. You can monitor this condition through a gas monitoring site like Ethereum Gas Station or through extension wallet Like Metamask which displays an estimation real-time.
2. Use a simulation before the transaction
Before actually pressing the button “Confirm“, It helps you simulate the transaction first. Crypto wallet like Metamask can display estimates gas Automatically when you interact with DAPPS. That way, you can judge whether the transaction is worth doing now or better postponed.
3. Consider alternative blockchain
If you are not really bound by the Ethereum ecosystem, there are other options that offer a much lower transaction fee. For example:
- Solana: The cost per transaction is only around US $ 0,00025.
- Binance Smart Chain (BSC), Cardano, or Near Protocol can also be an efficient alternative, especially for activities such as transfer tokens or Farming.
If you want to be even more efficient, you can also consider exploration of Ethereum-2 layers such as arbitrum, optimism, or base, which is specifically designed to reduce gas fee. Interesting veryright?
That’s the full explanation about what it is gas fee commonly used in transactions on the Ethereum network. So, now you don’t need to be confused anymore if you hear the term when the transaction.[msn]
