Ever wondered how gas fees are calculated in Ethereum
transactions? Let's simplify it with a real example and some formulas!

In this post, I'll be explaining the concept with the help of a random 
transaction on the Ethereum network.

In Ethereum, gas fees are determined by:

Web3 builder, React.js, Solidity, Codeigniter-PHP, Tech educator at CodeCrunchTechSchool, bookworm.

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Gas Limit & Usage by Txn: Gas Limit is the maximum amount of gas a  user is willing to spend on a transaction, while Gas Usage by TXN is  the  actual amount of gas used to execute the transaction.

The number  21,000 is the standard Gas Limit for a simple Ethereum transaction,  such as transferring ETH. This number can change for more complex  transactions, like interacting with smart contracts, as they require more  computational work.

Gas Price: The amount of Ether the sender is willing to pay per unit  of gas.

For our example transaction:  
Gas Limit and Gas Usage by Txn = 21,000  
Gas Price = 35.061407301 Gwei  
Hence,  
 - (21,000 * 35.061407301)/1 billion
  = 0.00073628955(Transaction Fee in Ethers)
- ((21,000 * 35.061407301) /1 billion) *   3,492.21(Current ETH Price)
= 2.571277741(Transaction Fee in Dollar)

This calculation shows that the gas fee for our example transaction was  0.000736289553321 ET or $12.57.   
I hope this explanation helps you better understand how gas fees work in Ethereum transactions!

#Ethereum #GasFees #Blockchain

The formula to Compute the Transaction Fee is 👇   - Gas Limit and Gas Usage by Txn * Gas price Gwei/ 1 billion   = Ethers Units  - Gas Limit and Gas Usage by Txn * Gas price Gwei / 1 billion * price of ether  = Gas fees in dollars