Gwei

What is Gwei?

Gwei is a subunit of Ether (ETH) and is commonly used to express transaction fees and gas prices on the Ethereum network. One Gwei equals one billionth of an ETH (1 Gwei = 0.000000001 ETH), making it a practical and readable unit for representing small amounts of Ether, especially in the context of transaction costs. The use of Gwei allows for greater precision and consistency in measuring and managing fees associated with Blockchain activity.

On Ethereum, every transaction or smart contract interaction requires a certain amount of gas - a unit representing computational work. Users then specify a gas price, which is how much they are willing to pay per unit of gas, and this price is expressed in Gwei. The total fee paid for a transaction is calculated by multiplying the gas used by the gas price in Gwei. For example, a transaction requiring 21,000 units of gas at 30 Gwei per unit would cost 630,000 Gwei, or 0.00063 ETH.

Using Gwei simplifies the fee-setting process and avoids the inconvenience of dealing with long decimal places when expressing small fractions of ETH. It also makes it easier to compare transaction costs, estimate required fees, and communicate pricing clearly across tools, wallets, and platforms. Because Ethereum is a competitive, decentralized network, validators typically prioritize transactions with higher gas prices, especially during periods of network congestion. As such, users may choose to increase the Gwei they offer to ensure faster confirmation. Conversely, during periods of low activity, users can lower their gas price to save on costs. Gwei also plays an important role in Ethereum’s evolving fee model, particularly with the introduction of EIP-1559. This upgrade introduced a base fee that is burned and a priority fee (tip) that can still be set by users to incentivize faster inclusion. These components are still denominated in Gwei, further cementing its role as the standard unit for transaction cost representation.