Ethereum Blockchain’s ETH Fee Upgrade EIP-1559

When you perform a cryptocurrency transaction using any blockchain network such as Ethereum, you need to pay a specific amount of transaction fee to accomplish the transaction successfully. Your transaction efficiency depends on various factors such as transaction fees and network congestion. If you pay a higher fee than other users then definitely your transaction would be on the first preferences of the validator, But sometimes, this approach leads to terrible transaction fees. So, today in this article we will deep dive into the improvement in the fee structure using EIP-1559 and also discuss how it helps the users to control the high transaction fee. So let’s get started!

Ethereum Blockchain's ETH Fee Upgrade EIP-1559 

Ethereum Blockchain's ETH Fee Upgrade EIP-1559 was initiated to control the crypto gas wars. Before directly going into the EIP-1559 let's go through with the crypto gas wars. In crypto gas wars, users bid for fast transactions and are listed in the queue accordingly. The user participated in this war by competing with the bid of multiple users. Users must have greater gas fees than all other users in order to compete with them and win the auction. He or she would thereafter move up the validators' priority list. But there are so many negative consequences found in the gas war are listed down:

  1. High Budget Required for Crypto Gas Wars Participation
  2. Gas Prices Unpredictable
  3. Network Congestion

After facing these negative consequences of the gas war, EIP-1559 came into concept. It is an Ethereum Improvement Proposal with the aim to reform the fee structure of the Ethereum blockchain network. Because as we discussed, previously in the gas wars the high fee structure was the first preference of the validators and it led to many negative consequences as we discussed. Further one of the major problems with that was the high and unpredictable transaction fee. So, here EIP-1559 proposed a new fee structure. In this structure, the validator prefers the base fee with some tip in addition.

  • Base Fee: The base fee is the lowest fee and it is automatically adjusted on the basis of network congestion. If there is huge traffic on the network then it would be set accordingly else a very low fee would be charged.
  • Tip: The tip is the extra amount that is added by the user to prioritize their transaction to be added in the next block. Users can add the tip according to their budget.

EIP-1559 reduced the consequences that the users faced in the gas wars and reformed them into a fascinating solution. There are so many benefits of EIP-1559 such as:

  • No fear of unpredictable price
  • It reduces network congestion which leads to the efficient transaction.
  • Use of deflationary mechanisms

Well, their EIP-1559 compensated its users. Also, it was not good for miners because they cannot earn more than they were earning through the gas war.


In conclusion, EIP-1559 is an improvement in the consequences that were faced in the gas war. It is the solution to reform the fee structure. In the gas war where the user with a high fee auction was the first preference of the validator. Here on the other hand, the EIP-1559 base fee would be preferred with some tip according to the budget of the users. So, in this mechanism users can set an amount according to their budget in the form of a tip as well as there is no fear of unpredictable prices.

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