Definition
A gas fee compensates for transaction execution on a network that meters work using gas. On Ethereum, the fee is paid in ETH even when a transaction transfers another token. Gas quantity measures work; the gas price states how much native currency is paid per unit. Neither should be confused with the amount of the asset being sent.
Fee Calculation
For ordinary Ethereum execution, the execution fee equals gas used multiplied by the effective gas price. Under its base-fee mechanism, the base-fee portion is burned and a priority fee can reward the block proposer. A user’s maximum fee setting limits what they are willing to pay per gas; it need not equal the actual rate charged.
Key Considerations
Complex transactions often consume more gas, and congestion can raise the price per unit. Failed execution can still incur a fee for work performed. Layer 2 networks or transactions with additional data components may involve further charges, so the simple execution formula may not describe the entire cost. Wallet estimates should be checked against the network and transaction type.