What are these commissions of a sometimes formidable amount that are deducted during certain transactions? If you have converted ETH (Ethereum) with another currency, you have probably been amazed by the amount of commissions charged for such a transaction. For example, out of curiosity, you want to buy UNI for about 40 euros in order to get an idea of the evolution of its price at little cost. Only then, you find yourself having to pay a total of 110 € for this operation. That is costs of around 70 €.
These costs constitute the gas fees (literally this expression means “petrol costs”). These are the commissions that are paid to the minor who performs the validation of a given transaction. By default, this gas price is expressed in GWei or giga-weis, the weis being the smallest unit of ETH (Ethereum).
Suffice it to say: the amount of gas fees is often excessive! It may not be possible to convert from one currency to another due to the importance of gas fees. L’exchange (marketplace) then lets you know that you do not have enough funds in Ethereum to pay these famous commissions. Sometimes also, you will prefer to reject the transaction believing that the stake is not worth the candle: is it reasonable to pay so many gas fees ?
Why are gas fees so high?
The importance of gas fees is partly the price of Ethereum’s fame. This blockchain is the most used in 2021. Most of the appsapps of the ChallengeChallenge (decentralized finance) are indeed based on Ethereum. This is particularly the case for Compound (loan), Uniswap or Sushiswap (currency exchange), Synthetix (stock market investment)… The same is true for NTF production platforms such as OpenSea or Rarible.
As Ethereum is the most used blockchain, its network is often congested. Miners are given an excess of transactions to process and so they choose to get away with raising their fees. In fact, if we agree to pay more than gas fees, one can speed up the processing of a particular transaction. Conversely, if you want to pay less, you can choose a slower processing time, for example, about thirty minutes. The etherchain.org site gives an estimate of the gas fee depending on whether you want the transaction to be fast or slow at any given time.
One way to reduce the gas fees is to operate its transactions at times when Ethereum traffic is the most restricted, usually Saturday or Sunday.
A blockchain affair
It is important to know that the gas fees vary according to the blockchain used. The Ethereum blockchain is the one with the highest commissions. However, there are many alternatives with gas fees much more reduced. It may therefore be good to select applications based on one of the following blockchains:
- Binance SmartChain (BSC). Used on very popular platforms such as Pancakeswap, the BSC practices gas fees extremely reduced – of the order of one hundredth of a euro.
- Solana. In less than six months, SOL has climbed into the top 5 cryptocurrencies and this popularity is partly due to gas fees again insignificant, around a thousandth of a euro.
- Polygon. On this blockchain, the gas fees are greatly reduced there and this is one of the reasons why the OpenSea platform mentioned above offers Polygon as an alternative to Ethereum for the creation of NFTNFT. However, even if they remain much lower than those of Ethereum, the gas fees on Polygon have tended to grow strongly.
- Tezos. It wants to be the “green blockchain” and its gas fees are minimal, but so far few platforms have adopted it.
- Ethereum V2. Version 2 of Ethereum, normally deployed in 2022 promises to have gas fees very reduced. To do this, part of the calculations are moved to a second level with a speedspeed extremely increased treatment.
The future of Ethereum in question
Clearly, failing to quickly release its V2, Ethereum could be strongly threatened by a blockchain such as Solana, due to the gigantic difference in gas fees.