A gas fee is the payment required to have a transaction processed and recorded on a blockchain such as Ethereum. "Gas" measures the computational work a transaction demands; the fee is that work priced in the network's native coin.
Fees are set by supply and demand for block space, not by any fixed price list. When the network is busy, users effectively bid against each other and fees spike; when it is quiet, they fall. A simple transfer costs less gas than a complex smart-contract interaction.
Gas fees can make small transactions uneconomic at busy times, since a few dollars of activity might carry a fee of similar size. This is one reason newer networks and "layer 2" systems compete largely on how cheaply they can process transactions.
Worked example
Sending tokens on Ethereum during a busy period can cost more in gas than the same transfer would at a quiet hour.
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Related terms
Frequently asked questions
What does Gas fee mean?
The cost paid to have a transaction processed on a blockchain such as Ethereum. Fees rise and fall with network demand.
Is Gas fee a crypto or a stock-market term?
It is primarily a cryptocurrency term.
Is this Gas fee definition financial advice?
No. The Market Capitalize glossary is educational — it explains terms and concepts, never a recommendation to buy or sell. See our disclaimer.