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August 1, 2022

What are Gas fees?

Learn more about what are gas fees and how you can prepare in advance of your purchases and bids!

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What are Gas Fees?

In order to send any transaction on the Ethereum network, a bit of ETH is needed for the transaction fee. Using real-world examples, the gas is like the fuel (a transaction fee) that executes the type of transaction you're making.

The gas fees are also required to pay the miners. The miners are there to validate your transaction and execute it onto the network. This is often referred to as Proof of Work (PoW).

Note: It's important to understand that Enjin does not take any of these fees and we're unable to refund any Ethereum for gas fees. Once a transaction is sent, it is non-reversible.

To understand better the concept of Gas Fees and how these work with NFT.io, we have added various topic points in this article to help you.

What is GWEI?

Gas fees are paid in Ethereum's native currency, Ether (ETH).  Each Gwei is equal to 0.000000001 ETH (10-9 ETH). A Gwei or Gigawei is defined as 1,000,000,000 Wei, the smallest base unit of Ether. Conversely, 1 ETH represents 1 billion Gwei.

Gwei is a denomination to calculate gas fees (paid to miners for transaction processing) in an efficient way.

How does gas fees work with NFT.io?

When listing, purchasing or bidding on an NFT, gas is required to make sure your transaction(s) execute and go through successfully on the Ethereum network.

As you interact with the NFT.io Marketplace, always ensure you have enough ETH in your wallet to pay for the gas fees.

The following are events/interactions on NFT.io that requires ETH for gas fees:

  • Wallet Approval for Marketplace Smart Contract (one-time fee)
  • Editing your profile (no-fee)
  • Listing an NFT (recurring fee)
  • Cancelling a listing (recurring fee)
  • Purchasing an NFT (recurring fee)
  • Bidding an NFT (recurring fee)
  • Cancelling a bid (recurring fee)

One-time Fees

Approving the NFT.io smart contract requires a one-time fee to use. This is mandatory to grant you transaction permissions between your wallet and NFT.io. If you use a different wallet address to connect, you will also need to approve the smart contract for that wallet (one-time fee).

Recurring Fees

Whenever you list, purchase, bid or cancel an NFT, you will always need to have Ethereum in your connected wallet to proceed further with the transactions/interactions you're making. These are recurring fees as you will always need to have a bit of ETH in your wallet.

Note: It's important to understand that Enjin does not take any of these fees and we're unable to refund any Ethereum for gas fees. Once a transaction is sent, it is non-reversible.

What are Ethereum miners?

As the Bitcoin network, Ethereum uses a Proof-of-Work consensus mechanism. With this, miners are there to successfully execute your transaction on the Ethereum network by using decentralized computers. These computers then use their computing power to process and validate the legitimacy of your transactions.

Miners are then paid in Ethereum's native token, ETH. Gas prices fluctuate depending on the status of the network and how many transactions are being sent in a second.

When you execute a transaction, this is then sent to the network in a processing state. In developer terms, this is also often referred to as "Broadcast state". This does not guarantee that your transaction has succeeded just yet. Depending on how much ETH you used for the transaction, depends on the priority of when it will be executed.

It's a good general practice to note, the more you pay in gas fees for any transaction, the quicker your transaction will mine. Conversely, the less you pay in gas fees (or using the minimum amount), may take longer to mine your transaction.

Gas prices will rise due to network congestion, so at times it's always best to check beforehand the current gas prices and how you can best prepare for them.

How do I check for the current price of gas fees?

We recommend the following gas stations to check on the current price of the fees to help you determine how much ETH is needed for your transaction(s):

It's important to note, gas fees on Ethereum always fluctuate and will change. Therefore, when you interact with the marketplace (e.g. purchasing an NFT), the price will change after you've performed your transaction.

Why is gas recently so high?

In recent times, the gas fees on Ethereum have risen due to network congestion and can be almost unusable to some as they result in being too expensive to do anything. Additionally, another reason for the increase in gas fees is the high traffic and recent popularity in NFTs, Web3.0, and decentralized apps (DApps).

As there is no firm solution to this with NFT.io, we're working on an Ethereum scaling solution called Efinity. Efinity is the next-generation blockchain for all NFTs, built as a parachain on Polkadot. To learn more about Efinity, check our article here.

If you're looking to have something done urgently and you're happy to pay a little bit extra, you can pay more in the gas fee to prioritise your transaction. This will ensure your transaction is being prioritised by the miners and will be completed faster.

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