Ethereum uses a gas fee model where transaction costs fluctuate based on network demand and are paid to validators. During peak DeFi activity, Ethereum gas fees have exceeded $50 per simple transaction. In contrast, the Ripple transaction cost is a fixed 0.00001 XRP — under $0.0002.

XRP does not have a gas fee in the Ethereum sense. The XRP Ledger's fee mechanism uses a base fee in drops (1 drop = 0.000001 XRP) that adjusts only during extreme congestion via an exponential curve, but rarely approaches even $0.01 per transaction.

The architectural reason for this difference: Ethereum's gas pricing creates a market for block space where users compete for inclusion. XRP's Federated Consensus does not have this competition — validators agree on transaction ordering without a fee auction.

For use cases requiring sub-cent transaction costs at scale — cross-border payments, micropayments, real-time settlement — XRP's fee model makes it fundamentally more suitable than Ethereum.