#CryptoFees101 #CryptoFees101: Quick Understanding of Cryptocurrency Transaction Fees

When participating in the world of cryptocurrency, one of the concepts you will frequently encounter is transaction fees. This is the fee you have to pay when making a transaction, such as sending Bitcoin, swapping tokens on Uniswap, or interacting with a smart contract.

Why are fees necessary?

Transaction fees serve as a reward for transaction validators (miners or validators), helping ensure the network operates smoothly and securely. Higher fees often help transactions get processed faster.

Each network, each type of fee:

Bitcoin/Ethereum: Charges fees based on the complexity and level of congestion of the network.

Ethereum: Uses “gas” – you pay gas depending on the action and gas price at that moment.

Solana/Polygon: Much lower fees, suitable for retail users.

Note:

Some dApps require multiple steps, meaning multiple fees.

It’s advisable to check the fees carefully before hitting "Confirm."

Use layer 2 blockchains or networks with low fees if you frequently make small transactions.

Understanding fees to avoid “losing money for no reason” – that is a vital principle when investing in crypto!