Crypto Investing — Intermediate: How Transactions & Fees Work

When you send crypto, your wallet signs the transaction with your private key and broadcasts it to the network. Validators include it in a block, after which it gets confirmations as more blocks stack on top. More confirmations = more finality.

Networks charge a fee (on Ethereum called gas) to prioritize and pay for computation. Fees rise when the network is busy. Layer-2 networks (e.g., rollups) batch activity to reduce cost while inheriting security from the base chain.

Key takeaways

• Transactions are signed locally, then confirmed by the network.
• Fees (gas) reflect demand for block space and computation.
• Layer-2s lower costs by batching activity off the main chain.

Educational disclaimer: This material is provided by Nieto Engineering Inc. for internal education only. It is not investment, financial, legal, or tax advice and is not a recommendation to buy, sell, or hold any asset. Cryptocurrency, equities, and prediction markets carry substantial risk, including total loss of capital. Past performance does not indicate future results. Always do your own research and consult a licensed professional before investing.