More

    Ethereum Gas Fees: How to Save on Them

    The long-awaited Ethereum Merge took place early on September 15, 2022. The more energy-efficient proof of stake algorithm (PoS) replaced the energy-intensive proof of work (PoW) consensus mechanism.  Never before has a blockchain switched from PoW to PoS, so the question begs to be asked; Will Ethereum gas fees rise following the Merge? And will Ethereum become faster?

    No one would be surprised to learn that gas fees are a user experience problem on Ethereum. Since 2020, the network has seen massive transaction volume increases due to the influx of DeFi and NFT activities. During peak hours, this causes the network to become congested, raising costs for everyone.

    It’s easy to see why so many people hoped the Merge would solve these problems. The good news is that it established a platform for further optimization of Ethereum gas fee structures in the future. In this article, we will:

    • Explore Ethereum Gas Fees
    • Explain why The Merge didn’t reduce gas fees
    • Discuss how to avoid Ethereum Gas Fees
    • Highlight future plans to lower gas fees

    What are Ethereum Gas Fees?

    Gas Fees

    Gas fees are compulsory fees users have to pay to transact on the ETH blockchain. Ethereum gas fees are paid in Gwei, a subunit of ETH, and the amount fluctuates based on market demand. Gas fees are the levies for all smart contract-based token transfers, swaps, NFT creations, etc.

    Ethereum gas fees are proportional to the complexity of each transaction. Because of the EIP-1559 upgrade that went into effect in August 2021, gas pricing has undergone considerable revisions. Users expect gas fees to rise exponentially when there’s an increase in the number of customers making simultaneous transactions. Gas fees have sometimes risen to hundreds of dollars. Those who wished to mint virtual real estate, for instance, had to pay hundreds of dollars in transaction fees during the debut of Otherside, the metaverse of Bored Ape Yacht Club.

    How the Merge Affected Ethereum Gas Fees

    Nothing in the infrastructure of the Merge directly relates to reducing costs. And so, the Ethereum Merge did not directly lower gas fees. This did, however, lay the groundwork technically for further gas optimizations in the future.

    Activating PoS was the initial step toward allowing sharding. With this update, the protocol can break down the network into “shard chains” that distribute Ethereum’s workload, in theory easing congestion and boosting transaction throughput. Experts forecast sharding implementation in 2023 to increase the network’s scalability significantly.

    How to Avoid Ethereum Gas Fees

    Gas Tokens to Reduce Ethereum Gas Fees

    When Ethereum gas fees are low, gas tokens record contract info; when prices are high, they destroy the contract and apply the contract’s data to legitimate transactions. These tokens, which were first launched by GasToken.io, let you acquire gas tokens when fees are cheap and use them to pay transaction fees whenever you choose. Today, there are numerous gas token variations.

    Time Perfectly

    Finding the best trade time is the easiest way to save gas fees. Following the current gas price on the EtherScan Gas Tracker can let you delay your transaction till the right moment. Additionally, the history of gas prices gives us precise graphs. For instance, when the business day is coming to a close in Europe, Asia is still asleep, while the United States is just waking up, and Ethereum gas fees are typically lower.

    Set a Maximum Gas Fee Option

    Most Eth wallets let you choose how much gas you’re prepared to spend on the transaction. You can select to trade with a low gas fee if processing the transaction more slowly won’t bother you. Your purchase will not be complete until the gas fee decreases to the quantity you entered.

    Layer 2 Scaling

    Ethereum-based sidechains are L2 scaling options. Among L2 blockchains, Polygon, Optimism, and Arbitrum are the most well-known. These blockchains compile all the transactions made on their networks using their own native currency and send it to Ethereum. L2s essentially aggregate dozens of transactions into a single one, resulting in significantly lower gas costs. Even Polygon, though, has occasionally encountered network sluggishness and high transaction costs.

    Discount-Offering dApps

    Some Ethereum dApps provide customers with reimbursements, savings, or subsidies. Naturally, these savings only apply to purchases via dApp’s DeFi tools. Balancer refunds up to 90% of petrol expenses.

    Conclusion

    With the effects of the Merge and Ethereum 2.0 being in the works, high gas fees are not a permanent concern. With time, we might see gas fees going down. Until then, you can maneuver your way around them by following this list. You can save yourself a lot of money by just considering a well-thought-of approach.

    LEAVE A REPLY

    Please enter your comment!
    Please enter your name here

    Stay in the Loop

    Stay in the loop with blockchain Witcher and get the lastest updates!

     

    Latest stories

    You might also like...