How are Ethereum gas fees calculated?
An Ethereum fee is the gas a transaction uses multiplied by the base fee plus your priority tip, both in gwei. A plain ETH transfer always uses 21,000 gas, so at a 0.8 gwei base fee and 0.2 gwei tip it costs 21,000 × 1 gwei = 0.000021 ETH.
Three numbers
Since the London upgrade in August 2021 (EIP-1559), every Ethereum transaction fee has three parts:
- Gas used — how much computation the transaction consumes. A plain ETH transfer is fixed at 21,000 gas. Token transfers and contract interactions use more, depending on the contract.
- Base fee — a per-gas price set by the protocol for each block. It is burned, not paid to anyone.
- Priority fee (tip) — an extra per-gas amount you offer the block proposer.
fee = gas used × (base fee + priority fee)
You also set a max fee per gas. If the base fee rises above your maximum before you are included, you wait; if it is lower, you pay only base fee plus tip.
How the base fee moves
Each block has a gas target equal to half its gas limit. EIP-1559 adjusts the base fee after each block:
- If the block used more gas than the target, the next base fee rises.
- If it used less, it falls.
- The change is proportional and capped at 12.5% per block.
So ten consecutive full blocks raise the base fee by at most 1.125¹⁰ ≈ 3.25 times. That predictability is why the daily log can show the next block’s base fee as well as the current one: it is computed from the last block’s fullness.
The log also reports how full recent blocks were on average. A figure below 50% means blocks are under target and the base fee is drifting down.
Worked examples
At a base fee of 0.755 gwei and a tip of 0.2 gwei (0.955 gwei total), with ETH at $2,400:
| Action | Gas | ETH | USD |
|---|---|---|---|
| ETH transfer | 21,000 | 0.0000201 | ≈ $0.048 |
| Same at 20 gwei total | 21,000 | 0.00042 | ≈ $1.01 |
| Same at 100 gwei total | 21,000 | 0.0021 | ≈ $5.04 |
Contract calls vary too much to give a single number; your wallet simulates the call and shows an estimate before you sign.
Where the log gets its numbers
We call eth_feeHistory on a public Ethereum mainnet JSON-RPC endpoint, asking for the last 20 blocks’ base fees and the 10th, 50th and 90th percentile tips. The log shows the latest base fee, the median of the 50th-percentile tips, and prices a 21,000-gas transfer. Details are on the methodology page.
Tips for lower fees
- Watch the base fee, not just the tip. The base fee is usually most of the cost; tips mainly matter when blocks are full.
- Avoid congestion spikes. Popular mints and market crashes push blocks to their limit and the base fee climbs 12.5% per block.
- Check the network. Layer-2 networks (rollups) and other chains have their own fee markets; this page covers Ethereum mainnet only.
- Beware of fake “gas refund” offers. Gas is never refunded by strangers; see scam warning signs.
Comparing with Bitcoin
Bitcoin prices space (sat/vB) through an open auction; Ethereum prices computation (gas) with a protocol-set base fee plus tip. Both charge by resources used rather than by value transferred. For the Bitcoin side, read how Bitcoin fees are calculated.
Questions people also ask
- What is a gwei?
- A gwei is one billionth of an ether (0.000000001 ETH). Gas prices are quoted in gwei because the numbers are easier to read.
- Why did I pay less than my max fee?
- Under EIP-1559 you set a maximum, but you pay only the block’s base fee plus your tip. The difference between your maximum and what was needed is not charged.
- Does a failed transaction still cost gas?
- Yes. If a transaction is included but reverts, the gas consumed up to the failure is still paid, because validators did the work.
Sources
- EIP-1559: Fee market change for ETH 1.0 chain
- ethereum.org: Gas and fees
- ethereum.org: JSON-RPC API (eth_feeHistory)
Prepared by Daily Crypto News from the sources above. Published 2026-10-15; last reviewed 2026-10-15. See our editorial standards. Not financial, tax or legal advice.