Gas (Transaction Fee)

Gas is a unit used in blockchain networks like Ethereum to measure and pay for the computational resources required to execute transactions and smart contracts. Every operation—from simple ETH transfers to complex DeFi or NFT interactions—requires a specific amount of gas, which reflects its processing cost. Users pay transaction fees by multiplying the amount of gas used with the gas price, usually denominated in Gwei (a subunit of ETH). With the EIP-1559 upgrade, Ethereum introduced a base fee (which is burned) and a priority fee (or tip) to reward validators. Gas ensures network efficiency by assigning a cost to every operation. This prevents spam, encourages optimized smart contracts, and compensates validators for their work. Gas prices fluctuate based on demand—rising during congestion and falling when traffic is low. By design, gas acts as a dynamic pricing tool for blockchain computing, helping allocate limited resources fairly while maintaining network security and economic sustainability.