Network fees and gas

Every transaction on a blockchain pays a fee to the network. The fee depends on how busy the network is and how much work your transaction needs. It does not depend on how much money you send.

Why fees exist

Space in each block is limited. Fees decide which transactions get in first, pay the miners or validators who process them, and make spam expensive.

A network fee is different from an exchange's withdrawal fee. The exchange sets its own charge, which may be higher than the network cost.

Bitcoin fees

A Bitcoin fee is based on the size of the transaction in data, not its value. Sending $10 can cost the same as sending $10 million.

• Wallets quote a fee rate in satoshis per virtual byte.
• Miners choose the highest-paying transactions first.
• When many people are sending, the rate needed to get in quickly goes up.

If your fee is too low, the transaction waits in a queue called the mempool until space is cheap enough. It is not lost. Many wallets let you raise the fee on a waiting transaction.

Ethereum gas

Ethereum measures the work a transaction needs in units of gas. A simple transfer of ETH uses 21,000 gas. Moving a token or using a smart contract uses more.

The fee is:

gas used × (base fee + tip)

• The base fee is set by the network and changes with demand. It can rise or fall by up to 12.5% from one block to the next. It is burned.
• The tip goes to the validator and encourages them to include your transaction.

Prices are quoted in gwei. One gwei is a billionth of an ETH. With a base fee of 10 gwei and a tip of 2 gwei, a simple transfer costs 21,000 × 12 = 252,000 gwei, or 0.000252 ETH.

Three facts that surprise people

You pay in the network's own coin. Sending a token on Ethereum needs ETH for gas. Keep a little in the wallet.

Failed transactions still cost. If a transaction runs out of gas or the contract rejects it, the work was still done and the fee is still charged.

Fees change by the minute. The same action can cost several times more at a busy moment.

Layer 2 networks

Networks built on top of Ethereum bundle many transactions together and are much cheaper. In October 2026, ethereum.org listed average costs of $0.12 on Ethereum and $0.0016 on these networks. Lesson 33 explains the care needed when moving between them.

Paying less

• Check the fee on the confirmation screen before you approve.
• If it is not urgent, wait for a quieter time or choose a slower setting.
• Combine small transfers into fewer, larger ones.
• Leave enough of the native coin to pay for your next transaction.