What Is Gas?
Gas is the fee you pay to have a blockchain execute your transaction. Block space is scarce; gas is the auction for it. Simple transfers burn a little, complex smart contract calls burn more, and congestion multiplies the price of every unit.
How It Actually Works
- Every operation costs computational units. Your total fee is units used times the going price per unit, paid in the chain's native coin: ETH on Ethereum, SOL on Solana.
- On Ethereum, a base fee floats with demand and gets burned, and an optional priority tip pays validators to include you sooner. Congestion, an NFT mint, a panic, a popular launch, can 10x the price within minutes.
- Layer 2s exist mostly to shrink this line item: the same swap that costs dollars on mainnet costs cents on Base or Arbitrum. Solana fees run fractions of a cent by design.
- Failed transactions still pay. The network did the work of rejecting you, and it charges for it.
Risks and Common Mistakes
- Trading small amounts on expensive chains, where fees quietly eat double-digit percentages of the position. Fees are part of the trade; my profit calculator includes them for exactly this reason.
- Rushing during spikes instead of waiting hours for the mempool to clear. Most transactions are not urgent; the fee market bills urgency.
- Draining the native coin entirely, leaving a wallet full of tokens it cannot afford to move. Always keep a gas reserve.
- Fake "gas refund" and accelerator sites, which are phishing wearing a utility costume.
When It Matters
Every on-chain action, and especially DeFi, where multi-step strategies pay gas at each step. Live fee data: Etherscan's gas tracker and L2Fees.info, both in my Resource Library.
Related Terms
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