Oh I agree it’s not insignificant! But what you need to keep in mind is that, in an economic sense, the BASEFEE and the TIP are NOT additive. To see why, imagine that following two facts are true:
- The fee level at which there is 8 million gas of demand per block is, in some particular span of time, 5 gwei
- Miners value the cost of including 1 gas worth of transactions at 1 gwei
Clearly, no miner will accept a transaction with a tip of less than 1 gwei, and let’s say there’s a bit of monopoly power added on top so miners on average only accept transactions with tips of 1.5 gwei. Suppose the BASEFEE starts off at 1 gwei. Users would have to pay only 2.5 gwei total, so demand is higher than 8 million; hence, blocks are more than 50% full, and the BASEFEE rises. Eventually, when the BASEFEE reaches 3.5 gwei (NOT 5 gwei!), users have to pay 5 gwei total, and at that point demand is equal to 8 million, so the BASEFEE reaches an equilibrium.
The one special case is the case where the equilibrium fee is less than the tip that miners demand. In this case, the BASEFEE would fall to zero and blocks would just be less than 50% full until demand rises again. But notice that in this situation, the current system would have the same consequence.