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What is Ethereum Gas?

Ethereum Gas is a unit that measures the amount of computational effort that it will take to conduct a transaction or execute a contract on the Ethereum blockchain platform. Every single action taken in Ethereum takes some amount of gas. In other words, gas refers to the amount of fees that need to be paid to the network in order to execute an operation.

Jan 1 · 2 min read
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Ethereum Gas is a unit that measures the amount of computational effort that it will take to conduct a transaction or execute a contract on the Ethereum blockchain platform. Every single action taken in Ethereum takes some amount of gas. In other words, gas refers to the amount of fees that need to be paid to the network in order to execute an operation.

Ethereum gas is known as gwei and is a different concept from Ether (the cryptocurrency). Having a separate unit allows maintaining a distinction between the actual valuation of the cryptocurrency, and the computational cost. This this way, say you need to send 1000 dollar to your landlord for this months rent. You pay the amount online with your credit card and there is a 2% service fee. In this case the 1000 dollar is the actual currency (similar to ether) whereas the 2% service fee is the amount of fees that needed to be paid to execute the transaction (just like gwei).

Gwei are payments made by users to compensate for the computing energy required to process and validate transactions on the Ethereum blockchain.

Ethereum miners, who perform all the tasks of verifying and processing a transaction, are awarded gas fee for their computational services. If the amount of gas is too low, the miners can simply ignore the transactions. Therefore, an appropriate amount of gas must be used to pay for the transaction. What this creates is a way to make sure that the network doesn’t waste energy on pointlessly long-winding transactions and that miners are paid rightfully and at the best amount.

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