GAS FEES

𝗚𝗔𝗦 𝗙𝗘𝗘𝗦 

Gas fees, also known as 𝘁𝗿𝗮𝗻𝘀𝗮𝗰𝘁𝗶𝗼𝗻 𝗳𝗲𝗲𝘀, are the cost of processing transactions on a blockchain, particularly on the Ethereum blockchain. 

They are paid by the user to validators who maintain and secure the network. 

These fees are calculated based on the amount of computational resources required for a transaction, denoted as "gas," and the price per unit of gas, also called "gas price". 

Here's a more detailed explanation :

What they are : 

Gas fees are the cost of processing transactions and executing smart contracts on a blockchain. 

Who pays :

Users pay these fees in Ether (ETH) or its fraction, gwei, to the validators who secure the network. 

Why they exist :

Gas fees compensate validators for the computational power and resources needed to process transactions, smart contracts, and other operations on the blockchain. 

How they are calculated :

Gas fees are determined by multiplying the "gas limit" (the maximum amount of gas a transaction can use) by the "gas price" (the cost per unit of gas). 

Factors affecting gas fees :

Gas fees fluctuate based on network demand, supply, and capacity. 

Example  : -

When using a DeFi app, you might see a gas fee added to the cost of your on-chain transaction. 

Impact :

Gas fees can significantly impact the cost of using certain applications, especially during periods of network congestion. 

Tips  :

You can choose to leave tips (priority fees) with your transactions to expedite them during high congestion. 

Ethereum's approach :

Ethereum utilizes a base fee and a tip fee (or priority fee). The base fee is burned to reduce the circulating supply of ETH. The priority fee allows users to prioritize their transactions.  •••••