Ethereum gas fee fluctuations significantly impact the DeFi ecosystem. High gas fees, driven by network congestion or increased demand, raise transaction costs, making smaller trades or interactions with DeFi protocols like Uniswap or Aave less viable for retail users. This can reduce liquidity, deter participation, and favor wealthier users, widening inequality. Conversely, low gas fees boost accessibility, encouraging broader adoption and innovation, as developers and users experiment with microtransactions or complex strategies. However, unpredictable fees complicate smart contract UX and profitability, especially for yield farming or arbitrage. Projects may migrate to layer-2 solutions or rival blockchains like Solana, fragmenting the ecosystem. Ultimately, gas fee volatility challenges DeFi’s scalability and inclusivity, pushing the need for Ethereum’s ongoing upgrades, like sharding, to stabilize costs and sustain growth. (134 words)