A gas fee is the cost of executing a transaction or smart contract on the Ethereum network. Gas fees are paid in ETH and fluctuate based on network congestion. During periods of high activity, gas fees can be very expensive (sometimes more than the transaction itself). Layer 2 networks like Arbitrum and Optimism were created to reduce Ethereum gas fees.
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Market Navigator Glossary — plain-English definitions of 93+ investing and crypto terms. All content is for educational purposes only and does not constitute financial advice.