A Network Fee, as the name implies, is a fee you pay to a blockchain network for transferring a digital asset on that network.

The fees go to the miners or validators of that blockchain network who win the right or are chosen by the validation mechanism to ultimately confirm your transactions and add to the blockchain.

Fees are paid by users of the blockchain, which includes individuals, businesses, and even crypto exchanges.

Under normal trading conditions, paying higher network fees will generally get your transaction verified quicker, as miners give you priority over transactions with lower fees.

Network congestion, however, can also make network fees drastically increase if the fees aren’t a fixed amount.

As network usage increases, some users are willing to pay higher fees to expedite getting their transactions verified quickly.

Miners are willing to take the larger reward, leaving users who aren’t willing to pay more fees waiting.

As you can imagine, this cycle continues over and over, with users paying higher and higher fees as congestion grows.

Ethereum (ETH) experienced increasingly expensive average network fees at the end of 2021, with fees averaging between $40 USD and $65 USD per transaction.

In June 2022, Ethereum (ETH) network fees are averaging $5.24 USD, their lowest in almost 12 months.

See transaction fees and miner fees for more info.