What Is “Gas” and How Does Its Cost Impact Decentralized Exchange (DEX) Arbitrage?

Gas is the unit used to measure the computational effort required to execute operations on a blockchain like Ethereum. The gas cost is the transaction fee paid to miners.

For DEX arbitrage, high and volatile gas costs are a major hurdle. They can quickly consume the small profit margin, especially in a race to execute a trade.

Arbitrage bots must bid high gas prices to ensure their transaction is included quickly, increasing operational risk.