Wei is the smallest denomination of Ether, or ETH, the cryptocurrency on the Ethereum network.
Wei takes its name from Cypherpunk member Wei Dai who proposed the first real cryptocurrency called B-Money, which is essentially a forerunner to Bitcoin, although it never passed the drafting phase.
In turn, it can be compared to Bitcoin’s ‘Satoshi Unit’ which represents 0.00000001 Bitcoin for similar reasons to Ether, to make a transaction fee more clear.
Why Use Wei?
As the price of Ether rises, the size of each transfer gets smaller. 1 ETH now may only be equal to 0.8 ETH in a few months.
But using Ether to quote a gas fee may become a headache as prices go up because it will become a smaller fraction of Ether. Therefore, Wei is used when dealing with smaller transactions playing an important part in gas fees and transaction fees.
As shown on Ethereum’s Technical Documents, these are the several sub-units, indicating the quantity used.