Why do I pay high gas fees for smart wallet transactions?

Interacting with a smart wallet for the first time triggers a deployment process, which is essential for enabling the wallet's functions. For instance, executing a one-click swap on a decentralized exchange (DEX) incurs initial deployment fees, increasing the gas costs associated with the transaction.

Wallet providers do not have any control over the gas fees associated with the smart wallets.

Furthermore, smart contract operations are inherently more complex than basic token transfers. This complexity arises from the sophisticated interactions and computational demands of executing smart contract logic, contributing to increased gas fees. These additional costs reflect the resource-intensive nature of securely facilitating advanced features and functionalities within the blockchain network.

Smart contracts are programs stored on the blockchain that run when predetermined conditions are met. The more complex a contract is (i.e., the more computational steps or logic it requires), the more gas (the unit that measures the amount of computational effort required to execute operations) it consumes. This is because every operation in the Ethereum Virtual Machine (EVM) has a specific gas cost associated with it, and complex contracts require more of these operations to execute. During periods of high demand, gas prices increase, making transactions more expensive.

To optimize your transactions, keep an eye on the Ethereum gas fees and consider withdrawing your assets when they significantly drop. You can monitor gas fees at Etherscan Gas Tracker.

Gas fee is expected to continue to trend downwards once the Cancun upgrade is made. Also known as Proto-Danksharding (EIP-4844), this is an intermediary Ethereum scability solution that will provide the scaffolding to later implement other scalability upgrades like sharding. It is expected to reduce gas fees on Ethereum by 10-100x by using a new type of blob-carrying transactions. EIP-4844 will make the transition to full sharding easier since all future upgrades will happen on the consensus layer only. Cancun upgrade is expected to be rolled out in Q1.