Gwei refers to a very small amount of Ethereum that is used to calculate transaction fees on the Ethereum network. One Gwei is equal to 0.000000001 ETH. If you pay 0.000000020 ETH as a transaction fee, you would say that the cost was 20 Gwei. Gwei is short for gigaWei. Wei is the smallest unit of the Ethereum coin. One Gwei equals 1 billion Wei.
How Gwei Works
Gwei is mostly used to pay Ethereum gas, a fee charged for transacting on the Ethereum network. Depending on the transaction you initiate, you may pay more Gwei for a faster transaction or less Gwei for a slower transaction.Because one Gwei is the same as 0.000000001 ETH, the value of one Gwei in dollars varies based on the current price of the Ether token. For instance, the dollar value of 50 Gwei today may not be the same as 50 Gwei tomorrow.The accurate value of Gwei at any time is based on the current Ethereum price.
The gas fees paid for Ethereum transactions also differ. The gas prices go up when transactions are congested in the network. If there are less transactions and the network isn’t busy, gas fees are cheaper.
Gwei and its Sibling Units of Ether
Apart from the Gwei, there are other units of ether that exist in the Ethereum network. Here are all the other units of either.
- Wei (wei)—which is named after Wei Dai, who formulated the concepts of all modern cryptocurrencies, and is best known as the creator of the prototype to Bitcoin, B-money.
- Kwei (babbage)—named after Charles Babbage, mathematician, philosopher, inventor, and mechanical engineer who designed the first automatic computing engines.
- Mwei (lovelace)—named after Ada Lovelace, mathematician, writer, and computer programmer; she published the first algorithm.
- Gwei (shannon)—for Claude Shannon, an American mathematician, cryptographer, and crypto-analysis guru, who is recognized as “the father of information theory.”
- Twei (szabo)—for Nick Szabo computer scientist, legal scholar, and cryptographer known for his early research in digital contracts and digital currency.
- Pwei (finney)—for Hal Finney, a computer scientist, and cryptographer; he was one of the early developers of Bitcoin, and alleged to be the first human to receive bitcoin from Satoshi Nakamoto.
- Ether (buterin)—for Vitalik Buterin, the creator of Ethereum.