If you’ve ever sent a transaction on the Ethereum blockchain, you’ll be familiar with the concept of paying gas. But with the rise of popularity on the Ethereum blockchain, these prices are rising out of control. So, if you’re tired of wasting money on gas and would rather keep your Ethereum for trading or to HODL, here are some ways that you can save money on Ethereum gas fees.
What is ETH Gas?
Ethereum Gas is a payment made to the miners that cover your transactions. When you send a transaction on the Ethereum network you have to pay for this gas. You’ll find an increase in gas fees and, therefore, higher prices when the network is more congested.
The more complex the transaction (for example, if you’re exchanging and providing liquidity), the higher the gas fees will be. Plus if you’re using the Ethereum network to send transactions at the time this is published, you’ll be well aware of how congested it currently is due to the massive costs to do anything on the network.
What is Gwei?
Gwei is a unit of Ether which stands for gigawei, or 1,000,000,000 Wei. Wei is the smallest unit or the base unit of Ether. Think of Wei as what cents are to the US dollar or satoshis are to Bitcoin.
Why are ETH Gas Fees so High?
Supply and demand ultimately determines the cost of Gas. Therefore, if the demand-side chooses to get their transactions included in a block sooner, then they need to pay a higher price for their transactions per unit of Gas. In the case of an increase in network activity, the demand for transactions increases, leading to a spike in transaction fees.
There are limits to the transaction fees, with only a certain amount of Gas being able to be paid per block. However, the miners can slowly raise these limits and increase the Gas limit by small amounts. It is thought that some of the cause of the rise in fees is down to the US-dollar backed stablecoin Tether and the rise in popularity in decentralized exchanges and DApps.
How to Reduce Gas Fees
Below are just some ways that you can help to reduce the Ethereum Gas fees that you pay.
ETH Gas Station
You can certainly save yourself on fees when you edit your gas with the help of Eth Gas Station. When you’re sending transactions from the likes of MetaMask, the gas fee will automatically be prefilled for you.
Many people use the default gas price from their wallets when they make their transactions, and this is generally okay. However, sometimes it makes sense to pay more if you want the transaction mined quickly or you may want to save some money and offer a cheap gas price, especially if you don’t care how quickly it is mined.
So, instead of just clicking on the confirm button, it’s worth just putting in an extra step, by clicking on edit and advanced first and checking the cost against Eth Gas Station.
With the price of gas at the user’s control, it is tempting to go for cheaper or slower speeds. But set the limit too low, and your transaction can not be executed because it runs out of gas. Then you’ll have to resubmit it, costing you more in gas fees. While offering a high gas price can speed up confirmation a bit, there is a limit to the acceleration. Therefore overspending won’t necessarily help you out either. So it’s important to get the price right.
Eth Gas Station will tell you real-time gas fees and recommend gas fees in GWEI for fast, standard or safe low transactions. As well as the time it’ll take to complete by choosing these different speeds.
ETH Gas Speeds
Safe Low: This is a gas price intended to be cheap and successful. It may take a bit longer to get a confirmation of this price but it should be safe to use. This price is determined by the lowest price where at least 5% of the network hash power will accept it. And It requires that at least 50 transactions have been mined in the last 24 hours at this price.
Average – This is the price accepted by top miners who account for at least 50% of the blocks mined. This is a safe and prompt transaction. And this is the price that usually reflects the wallet defaults.
Fastest – This is the lowest gas price that is accepted by all top miners (estimated over the last two days). Therefore, transactions with this gas price should be accepted by all the top pools. Paying more than this price is unlikely to help.
They do also have other information on their site such as leaderboards and charts. To be honest, most users will come here to check the gas price and then leave the web page.
So, once you’ve checked your gas fees and chosen the required speed for your transaction, you can then edit this in Metamask, which should, in turn, save you money if you’re willing to accept a slower transaction time (for example).
ETH Gas Tokens
You can use Gas tokens to save yourself on fees when times are congested, and prices are high. Gas Tokens can help users save on fees by storing cheap gas in periods of inactivity, using a clever contract trick that refunds gas when freeing storage. The likes of decentralised exchange aggregator 1inch use a gas token called Chi Gas Token.
The idea is similar to the GasToken token concept but it has some improvements. Chi is pegged to the Ethereum network’s gas price. When the gas price is low, the Chi price is also low, and the opposite. Just like GasToken, Chi is tokenized gas on the Ethereum network.
The only difference is that Chi is used on 1inch and Curve.fi, while the GasToken is used across the entire Ethereum network.
Crypto Wallets with Zero Fees
A great way to save on fees is by using wallets with zero gas fees. Previously these wallets included the likes of Digifox and Argent who were covering gas transactions costs themselves. However, due to increased gas fees, it no longer became feasible to continue with this.
Blockfolio, the popular portfolio tracking app has released an update to include “Trading“. Users can trade the likes of cryptocurrencies and stocks at zero fees. Not only that, but you’ll earn a free coin for every trade over $10.
The Trade functionality (powered by FTX) allows both US and international users to trade on Blockfolio. Users can trade between cryptocurrencies including Bitcoin, Ethereum and XRP and tokenised stocks like Airbnb, Apple and Tesla.
The Argent wallet does still have a couple of features that are still free, including their Security, such as adding a Guardian or changing your daily limit and it’s free for their Dai Savings Rate, which is still subsidised by Maker.
Argent is an Ethereum based mobile wallet where you can store, send, and save; borrow, earn interest, and invest. With the ability to enjoy decentralized apps in just a few taps, including Aave, PoolTogether, Compound Finance, and Uniswap.
With the Digifox you can get free transactions when referring to friends or family to their wallet.
Digifox, is an all-in-one finance application created by popular YouTuber Nicholas Merten (AKA DataDash). With DigiFox you can buy and swap crypto and send your money globally, at fees as low as $0.15. Plus, they have an “Earn” feature, using integrated platforms such as Celsius and Compound. This enables you to earn interest of between 5-9%, which is far better than any standard savings account.
Dapper ETH Wallet
I believe that the Dapper ETH wallet (available on GooglePlay for androids) also provide a few free transactions per week. Plus includes the ability to buy gas “packages”. Although this isn’t a wallet, I’ve personally used.
The Dapper wallet is an Ethereum smart wallet created by Dapper Labs, the creators of CryptoKitties. Allowing you to send, store, and manage your blockchain-based assets. Dapper Android also lets you play your favourite blockchain games through their easy-to-use built-in browser.