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Gas Fees
Gas fees are transaction costs paid by users to miners for processing transactions on a blockchain network. In Ethereum, for example, gas is measured in Gwei (a denomination of Ether), and the fee compensates miners for the computational resources required to validate and execute smart contracts or transactions. The higher the gas fee, the more likely the transaction will be prioritized by miners, especially during times of high network congestion. Gas fees can fluctuate depending on network demand. For instance, during the NFT boom in 2021, Ethereum gas fees spiked as many users competed to mint or trade NFTs. Gas fees are a critical component of blockchain economics, and high fees can deter smaller transactions. Efforts like Ethereum 2.0 and layer-2 solutions aim to reduce gas fees by improving network efficiency.
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