Base Fee

Overview

What it means and why it exists

The base fee is the protocol-determined minimum fee per unit of execution gas on Ethereum's EIP-1559-style fee market. It changes according to earlier block utilization and is burned rather than paid to the block proposer.

How it works

Ethereum compares gas used by recent blocks with the target. If blocks exceed the target, the next base fee rises; if they fall below, it declines. The sender chooses a maximum fee and optionally a priority fee; the transaction's actual effective gas price depends on the current base fee and the allowable tip.

Technical details worth understanding

Under EIP-1559, base fee adjusts by at most 12.5 percent per block in the ordinary execution-gas mechanism. The gas limit and target are not fixed forever, so using an outdated numeric block limit in fee forecasting is misleading. Blob gas has its own separate fee market and should not be added as if identical to regular execution gas.

What can go wrong

A quoted gas price is not a fixed transaction total: multiply effective gas price by gas actually used. Reverted contract calls can still burn execution gas. A merchant should keep fee accounting separate from invoice principal and from any service fee charged by its payment provider.

Practical checks

To estimate execution fees, read the latest base fee, choose an appropriate priority cap and account for possible movement by the inclusion block. Use gas *used*, not solely gas limit, in final accounting. Distinguish this protocol charge from any provider markup when explaining fees to a merchant.

Related concepts

Ethereum, Gas Fee, Layer 2.

Further reading

Ethereum — Gas and Fees.