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Understanding Ethereum and Layer 2 (L2) network fees
Understanding Ethereum and Layer 2 (L2) network fees
Matias Fabius avatar
Written by Matias Fabius
Updated over a week ago

Are you trying to send cryptoassets to a friend, use DeFi, or play a decentralized game? Every transaction you want to approve requires a “network fee,” sometimes also called a “gas fee.”

This fee is not paid to Zengo - instead, it is used to incentivize blockchain miners or operators to approve your transaction. When the network is congested, fees may increase. When network congestion is lower, fees may decrease. The table below explains how gas or network fees work across various blockchains, what tokens you should use to pay these fees, and how to get the necessary tokens.

Questions? Our legendary 24/7 support team is a simple tap away. Email help@zengo.com or chat with us here from your mobile device.

Blockchain / Layer

Token Called

Network token required

Network Fee

Free L2 Faucet (Zengo Pro only)

Looks like

How to get it from your mobile device

Ethereum (L1)

ETH

ETH

$2-$6

N/A

- Buy it here

- Swap it here

Polygon (L2)

MATIC

MATIC (on L2)

$0.10 up to $0.50

- Buy it here

- Swap it here

Arbitrum One (L2)

ETH

ETH (on Arbitrum One)

$0.10 up to $0.50

- Buy it here

- Swap it here

Optimism (L2)

ETH

ETH (on Optimism)

$0.10 up to $0.50

- Buy it here

- Swap it here

Base (L2)

(Coming Soon!)

ETH

Coming Soon!

$0.10 up to $0.50

Coming Soon!

Coming Soon!

- Buy it here

- Swap it here

Understanding ETH and ERC-20 Transactions

Do you have stablecoins like USDC or USDT, infrastructure tokens like Chainlink (LINK), or Memecoins like Shiba Inu Token (SHIB)? They are all versions of ERC-20 tokens on the Ethereum blockchain.

ERC-20 tokens are a type of digital asset that primarily operates on the Ethereum blockchain and can also be found on Ethereum L2 (Layer 2) networks like Arbitrum One, Optimism, and Base.

To execute transactions involving ERC-20 tokens, the required network fee must be paid in the native cryptocurrency of the corresponding network or chain on which the transaction is taking place! Also, make sure you have enough of the token required to pay the network fee!

Examples:

Example 1: If you have $50 of Tether (USDT) on Arbitrum One, and you want to send it to a friend, the network/gas fee for this transaction needs to be paid with Ethereum on Arbitrum One - not standard Ethereum on the main Ethereum Layer 1!

Example 2: If you use a decentralized social network powered by the Polygon (MATIC) blockchain, you might need to pay for network fees using MATIC.

How to add network fee tokens to your Zengo wallet

Buy: To facilitate easy access to the necessary tokens for paying network fees, Zengo has partnered with Transak. This partnership allows you to purchase cryptocurrencies like MATIC and ETH (including on Arbitrum One and Optimism) directly through Zengo, starting from as low as $5. Get started here from your mobile phone.

Swap: Swap from one token to another directly inside of your Zengo wallet. For example, you can swap some of your Bitcoin for ETH (Ethereum), if you need to use some ETH for a network fee. Get started here from your mobile phone.

Receive: Send the required token from another crypto wallet or an exchange to your Zengo wallet in a few simple taps!

This is an example of how a network fee (and type required) is displayed in your Zengo wallet.

Disclaimer: Don’t confuse networks; you might lose your assets forever!

Before initiating any cryptocurrency transaction, it is crucial to ensure that the network you are sending from and the network to which you are receiving are the same! Mismatched networks can lead to loss of funds. Ask support if you have any questions.

How much network fee is actually required?

Zengo will tell you how much fee is required on the summary page (before the confirmation and right after you tap the recipient address) when you try to send a transaction or perform an action on a web3 app and validate it in Zengo. If you don t have any ETH you can consult a gas estimator service like Etherscan (for sending an erc 20 token like USDT or USDC you want to use 21 000 / 45 000 as a custom gas limit)

A few important things to know

  1. network fees vary all the time based on the congestion of a network or layer 2 and this is independent of Zengo

  2. A network fee for an ethereum token (ERC-20 like USDT or USDC) or an action in an app on ethereum (like a decentralized exchange or NFT marketplace) is always more expensive than simply sending Ethereum alone because they involve "smart contracts," which are more costly in verifications on-chain. For example, it will cost more network fee to send $10 USDC on Ethereum than sending $10 of Ethereum.

  3. In Zengo, you can choose various speed levels, which vary in cost from cheap to fast, if you want to accelerate your transaction.

  4. If you want to find out an estimated cost of a specific transaction on ethereum, you can consult this page for ethereum or that page or even that page or this page

You can learn more about transaction fees on our podcast episode here

Zengo’s 24/7 support: We’re here to help!

If you have any questions, our legendary 24/7 support team is a tap away! Email help@zengo.com or chat with us directly inside your Zengo wallet by tapping the top-right icon (it looks like a headset) to get started.

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