Validators process transactions and receive fees from users (supply-side fees).

Ethereum is a smart contract platform for decentralized applications (a blockchain). Ethereum was founded by Vitalik Buterin, Anthony Di Iorio, Mihai Alisie, etc. and launched in 2015.

ETH holders own and govern the protocol. They currently take a cut of the total transaction fees (base fee) paid by users (revenue). Ethereum’s investors include KR1, Block Ventures, 8 Decimal Capital, etc.

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# Ethereum Average transaction fee Methodology

## 1. Overview

The Ethereum average transaction fee metric calculates the daily average cost paid per transaction on the Ethereum network in USD. This metric provides insight into network congestion and usage costs by dividing total daily transaction fees by the total number of transactions executed each day. The calculation combines both regular gas fees and blob gas fees (introduced with EIP-4844) to capture the complete cost structure of Ethereum transactions.

## 2. Data sources

- **Ethereum transaction records**: Raw blockchain transaction data containing gas usage metrics, gas prices, block timestamps, transaction hashes, and participant addresses
- **End-of-day price feeds**: Daily ETH/USD exchange rates used for currency conversion
- **Ethereum account labels**: Optional account labeling data for enriching transaction destination addresses with human-readable names

## 3. Step-by-step calculation

### Component A: Individual transaction fee calculation
- **Purpose**: Calculate the total fee paid for each Ethereum transaction
- **Logic**: For each transaction, extract gas usage data including `gas_used`, `effective_gas_price`, `blob_gas_used`, and `blob_gas_price` fields. Convert gas prices from wei to ETH by dividing by 10^18. Calculate the total transaction fee as the sum of regular gas fees (`gas_used` × `effective_gas_price`) and blob gas fees (`blob_gas_used` × `blob_gas_price`). Handle cases where blob gas data is null by using zero as the default value.
- **Key fields**: `gas_used`, `effective_gas_price`, `blob_gas_used`, `blob_gas_price`, `fee_amount`

### Component B: Daily fee aggregation and USD conversion
- **Purpose**: Sum all transaction fees by day and convert to USD
- **Logic**: Group individual transaction fees by day using timestamp truncation to daily granularity. Sum all `fee_amount` values for each day to get total daily fees in ETH. Convert the ETH-denominated daily fee totals to USD using end-of-day ETH price feeds through a standardized currency conversion process.
- **Key fields**: `timestamp`, `fees` (in USD)

### Component C: Daily transaction counting
- **Purpose**: Count the total number of unique transactions per day
- **Logic**: Group raw transaction records by day and count distinct `transaction_hash` values for each day. This provides the denominator for the average calculation. Transactions are filtered and grouped by various dimensions including chain, market sector, and business segment for proper categorization.
- **Key fields**: `timestamp`, `transaction_count`

### Final aggregation
- **Combining components**: Join daily fee totals with daily transaction counts on the timestamp field to align the data by day
- **Currency conversion**: Fees are converted to USD using end-of-day ETH price feeds before the average calculation
- **Time aggregation**: Data is aggregated to daily boundaries using timestamp truncation to day granularity
- **Final calculation**: Calculate the average transaction fee by dividing total daily fees (in USD) by total daily transaction count using a safe division function that handles cases where transaction count might be zero

*This methodology was automatically generated by Token Terminal's methodology analyzer.*

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Average transaction fee

Average transaction fee

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