Gwei is a small unit of Ether (ETH), the cryptocurrency used on the Ethereum blockchain, specifically used to denominate gas fees. One Gwei is equal to one billionth of an Ether (0.000000001 ETH). This denomination is commonly used because gas fees on the Ethereum network are typically much smaller than one whole Ether, and using Gwei makes it easier to specify and understand these small amounts. For instance, if the gas price is 20 Gwei and a transaction requires 21,000 units of gas, the total cost of the transaction would be 0.00042 ETH. By using Gwei, the network ensures precise calculation and payment of transaction fees, facilitating efficient operation and prioritization of transactions on the blockchain.
