Priority Fee
A priority fee, often called a tip, is an extra amount per unit of gas that you offer the validator on top of the base fee, as an incentive to include your transaction in a block sooner.
How the tip fits into the fee
Since the London upgrade in August 2021, an Ethereum transaction specifies two numbers: a max fee per gas, the most you are willing to pay in total, and a max priority fee per gas, the tip. The protocol charges the current base fee, which is burned, plus your tip, which goes to the validator. If the base fee plus tip is lower than your max fee, the difference is not charged.
Validators generally prefer transactions that pay them more, so when blocks are full, a higher tip can move your transaction ahead of others waiting in the mempool, the pool of pending transactions.
A worked example
Say the base fee is 30 gwei and you set a max fee of 50 gwei with a tip of 2 gwei. You pay 32 gwei per unit of gas: 30 burned, 2 to the validator. If the base fee jumps to 49 gwei before inclusion, your tip is squeezed to 1 gwei, because the total can never exceed your 50 gwei max fee. If the base fee rises above 50, your transaction waits.
When a higher tip helps, and when it does not
In normal conditions a small tip is usually enough, and wallets suggest one automatically. During busy moments, such as popular token launches or sharp market moves, tips rise as users compete for limited block space.
A bigger tip cannot help if the max fee is below the base fee; in that case it is the max fee that needs raising. To speed up a stuck transaction, wallets typically resend it with the same nonce and higher fees, replacing the original.
Pitfalls
Overpaying is common when users copy high tips from busy periods. For trades on decentralized exchanges, a high tip does not protect against front-running or sandwich attacks, forms of MEV (maximal extractable value) in which others reorder transactions around yours; private transaction relays are the more relevant tool there. On layer 2 networks, the priority fee works similarly but is usually tiny, and most of the cost comes from other components.
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Frequently asked questions
Is the priority fee required?
Technically it can be zero, but validators then have little reason to include your transaction when blocks are busy.
Who receives the priority fee?
The validator that proposes the block containing your transaction. The base fee, by contrast, is burned.
Does a higher tip make my transaction safer?
No. It only affects how quickly it is likely to be included, not whether the transaction itself is safe or correct.
Related terms
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