July 20, 2024

Ethereum Gas Fees: Challenges and Solutions for a Growing Network

Staking verifies and executes every transaction on the Ethereum network, but until recently, this process was done by miners. So the term gas was the unit to measure the effort of miners to process transactions, and gas fees are what users pay for the effort put in by the miners. The process of mining was eliminated after the Merge but the term gas fee remained and refers to transactional fees. Currently, gas fees are used as a reward for staking ETH and help maintain network security. It also prevents malicious actors from spamming the network, as every transaction is charged. There are various factors influencing gas fees, such as network capacity, supply, and demand. Gas fees are usually small amounts, tiny fractions of ETH, known as Gwei. 

Crypto users can also add tips to the gas fee to help speed up their transactions; the higher the gas fee, the faster the transaction. Gas fees keep fluctuating, and it is hard to predict their cost at any given time. The type and time of a transaction are the two main factors that affect gas fees. Gas fees are high when the Ethereum network is busy. Additionally, the complexity of transactions also determines gas fees, as simple transactions require low gas fees and complex ones require more.

KEY POINTS

Ethereum Gas Fee Solution

  • Optimize the timing of the transaction

Ethereum gas fees keep changing throughout the day. You can monitor the crypto market closely to determine when these fees are low. There are times when gas fees are usually low, such as on weekends or after midnight. You can study the fluctuations of gas fees from various charts to help you find the times when the gas fees are low.

  • Rebate offers

Several platforms offer attractive discounts on ETH purchases. They minimize the gas fees for users who buy ETH from their platform. Additionally, other apps charge gas fees collectively for a group of traders. This feature is beneficial as the gas fees are shared, and individuals pay fewer fees.

  • Choose the right transaction 

The gas fees are different for various types of Ethereum transactions. Users must compare gas fees associated with other types of transactions to ensure they choose the one with the lowest gas fees. There are other factors to consider when comparing gas fees, such as lower fees are associated with higher security risks, so choose a gas fee option that does not compromise transaction security.

  • Monitor network congestion

Network congestion is a prevalent issue faced by many users, especially during crypto trading. This is vital because any delay can lead to price fluctuations and, as a result, affect the profit that a trader expects from trading a crypto asset. You should continuously monitor the network and execute your trade as soon as you notice the congestion is low. You can check the mempool of the network (the waiting area for a transaction before it is processed) to monitor network congestion.

  • Calculate gas fees beforehand

There are many gas fee calculators in the crypto space to check the gas fees beforehand. They are technical tools to determine the gas fee in advance and provide a real-time value.  

How to calculate gas fees on Ethereum?

You can calculate the gas fees for a particular Ethereum transaction by multiplying the gas limit by the gas price per unit. For example, if the gas limit is 5,000 and the gas price per unit is 500 Gwei, the gas fee will be 5,000 multiplied by 500 = 2,500,000 Gwei, or 0.0025 ETH.

Conclusion

Ethereum gas fee plays a vital role in the functioning of the blockchain, but they can also be an issue for users, especially during peak hours. The Ethereum blockchain underwent an upgrade after the Merge. It was aimed at increasing the efficiency, scalability, and speed of the Ethereum network. It will also help increase transaction volume and reduce network congestion. Many crypto enthusiasts believe that Ethereum 2.0 will reduce the gas fees on the network, but they continue to remain high in 2023. While this upgrade did not lower the gas fees, it created an environment for future gas fee optimizations. In the meantime, you can use some of the solutions offered in this article to keep your Ethereum gas fees low.

How to buy Ethereum in India?

You can buy ETH to INR through ZebPay. Join the millions of traders already using the platform. Download the ZebPay App through the playstore or the App store and enjoy seamless crypto trading on the go.

Leave a Reply

Your email address will not be published. Required fields are marked *