Why are Ethereum gas fees so high?

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ETH Gas Fee is the amount that is paid by traders or investors in order to reduce spamming of the Ethereum network. Before a user can perform any transaction on the network a gas fee must be paid in order to permit for that. This gas fee paid is used to cater to the amount of computational resources to complete a transaction. Also, the gas fee depends on how complex the transaction is to perform. The gas fee is denoted by "gwei" and gwei is 0.000000001 ETH.

When there is high competition in completing a transaction on the blockchain, the gas fee is increased. This indicates that the gas fee would depend on the current condition of the ETH network. When the competition is high, the gas fee is also high and similarly, when the competition is less, the gas fee is lower than the formal. In calculating the gas fee for a transaction, the following is taken into consideration.

This was done by EIP-1559 when they upgraded the gas fee in somewhere August 2021. It made it easy to predict and estimate transactions cost. to calculate for the gas fee, you need to know the "base fee" of the block. Base fee refers to the minimum fee of a gas for a particular block on the ETH blockchain network and this is done by the network itself. The Standard formula below is used in calculating the gas fees;
Gas units (limit) X (Bas fee + Tip)

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_{Jonathan Borba}

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Now, why are ETH Gas fees so high? This is the main topic of this article. The following includes some of the factors why ETH has so high gas fees;
Your transaction may be a complicated one as discussed earlier: A complicated transaction here means sending ETH from one wallet to a different exchange wallet. For instance, sending ETH from Paxful to Binance would enquire high gas fees as compared to that which involves sending from a Binance wallet to another Binance wallet address. This is so because, in transacting between two different exchanges, there is high computational power used than when it is within the same exchange platform. Also, smart contracts usually inquire huge gas fees like swapping using Uniswap as it also requires high computational power to do that.

When there is an interest in the network which has been sustained: When interest on the ETH blockchain network is sustained, higher gas fees are paid on transactions. As more complicated transactions are performed on the network, there would be a continued increase in gas fees as well.

High competition in completing blocks or moving to the next blocks: As, said earlier, when competition arises in carrying out transactions on the network, there would be a huge increase in the gas fee as well. A good example is that of the Bored Ape Yacht Club NFTs they launched which later developed a high fee for these NFTs because a lot of people were having demand for it.

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Avoiding or Staying away from High Gas Fees

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Can we avoid high gas fees? We can maybe at least reduce it but not completely avoid it. The following include some of the ways we can reduce or minimize high gas fees;

1. You can wait until there is less competition in the crypto space. This would help in lowering the amount of computational power to complete the transaction, thereby reducing the ETH gas fee.
2. By using layer-2 solutions. This blockchain (layer-2s) helps to adjust the stability of the Ethereum blockchain's decentralization.
3. By using the Blocknative Gas Estimator to track the ETH gas fee before making any transaction.
4. By setting the base fee at low

This is where I would end my article, and I hope that is helpful to you all. Please note that I made my personal research and came out with this. If there are any mistakes somewhere, you can pinpoint them in the comment section and I would do my best to address that. Thank you all for visiting my blog. I am looking forward to seeing you guys again in my next post.

ETH Gas Fees
ETH gas fee Estimator.

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