Gas Fees, Network Fees & Blockchain Costs

Gas Fees, Network Fees & Blockchain Costs

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KoinGuide Team

Last Updated: June 2025

What Are Gas Fees?

Gas fees are transaction costs paid to use blockchain networks. Just like you need gas to drive a car, you need to pay gas fees to execute transactions and smart contracts on blockchains.

Key Point: Gas fees compensate network validators for processing your transactions and securing the blockchain. They vary based on network demand and transaction complexity.

How Gas Fees Work

Gas Units
Each transaction requires computational work measured in “gas units.” Simple transfers use ~21,000 units, while complex smart contracts can use millions.

Gas Price
The price per gas unit, measured in “gwei” (1 gwei = 0.000000001 ETH). Higher prices mean faster transaction processing.

Priority Fees
Extra fees paid to miners/validators to prioritize your transaction. Higher priority fees result in faster confirmation times.

Network Demand
During peak usage, gas prices increase as users compete for limited block space. Off-peak times typically have lower fees.

Gas Fee Calculation:

Total Fee = Gas Units × Gas Price

Example: 21,000 units × 50 gwei = 1,050,000 gwei = 0.00105 ETH (~$2-5 depending on ETH price)

Gas Fees by Network

Ethereum (ETH) High Fees

The most popular but expensive network. Fees range from $5-50+ during peak times.

Simple Transfer: $5-15 • DeFi Transaction: $20-100+ • NFT Mint: $50-200+

Polygon (MATIC) Low Fees

Ethereum Layer 2 solution with significantly lower fees and faster transactions.

Simple Transfer: $0.01-0.05 • DeFi Transaction: $0.05-0.50 • NFT Mint: $0.10-1.00

Binance Smart Chain (BNB) Low Fees

Ethereum-compatible network with consistently low fees and fast transactions.

Simple Transfer: $0.10-0.50 • DeFi Transaction: $0.25-1.00 • NFT Mint: $0.50-2.00

Solana (SOL) Ultra Low Fees

High-performance blockchain with extremely low fees and fast finality.

Simple Transfer: $0.0001-0.001 • DeFi Transaction: $0.001-0.01 • NFT Mint: $0.01-0.10

!!! Fees shown are estimates and can change with network activity.

What Affects Gas Fees?

Network Congestion

• High demand during popular NFT drops
• Major DeFi protocol launches
• Market volatility driving trading
• Viral meme coin activity

Transaction Complexity

• Simple transfers use less gas
• Smart contract interactions cost more
• DeFi protocols require multiple operations
• NFT minting involves complex contracts

Time of Day

• Peak hours (US/EU daytime) cost more
• Weekends often have lower fees
• Late night/early morning cheaper
• Holiday periods may vary

Gas Price Setting

• Slow: Lower fee, longer wait
• Standard: Moderate fee and time
• Fast: Higher fee, quick confirmation
• Custom: Set your own price

How to Minimize Gas Fees

Time Your Transactions
Use gas tracking tools to monitor network congestion. Transact during off-peak hours (weekends, late nights) for lower fees.

Use Layer 2 Solutions
Consider Polygon, Arbitrum, or Optimism for significantly lower fees while maintaining Ethereum compatibility.

Batch Your Transactions
Group multiple operations together when possible. Some wallets and dApps offer batching features.

Adjust Gas Settings
Use “slow” or “standard” speed for non-urgent transactions. Only use “fast” when immediate confirmation is needed.

Choose Alternative Networks
Explore other blockchains like Solana, Avalanche, or Binance Smart Chain for lower-cost alternatives to Ethereum.

Useful Gas Fee Tools

Network Congestion

• High demand during popular NFT drops
• Major DeFi protocol launches
• Market volatility driving trading
• Viral meme coin activity

Optimization Tools

• 1inch (DEX aggregator)
• Paraswap (gas optimization)
• Flashbots (MEV protection)
• Blocknative (gas prediction)

!!! Important Notes

Remember:

• Gas fees are paid even if transactions fail
• Setting gas price too low may cause transactions to fail
• Gas fees can be claimed as tax deductions in some jurisdictions
• Always keep extra ETH in your wallet for gas fees
• Gas fees are separate from the tokens you’re sending