If you ever send a transaction on Ethereum, you have to pay a certain amount of gas in order for the transaction to be confirmed. Without enough gas fees, miners may not select your transaction and include it in subsequent blocks. This article will explain the Gas fee in a vivid way to help novices better understand its role.
What is Gas?
In the Ethereum network, Gas plays a vital role. It is like the fuel of the network, ensuring that everything runs smoothly. More specifically, Gas is a unit of measurement used to measure the amount of computation required to perform a specific operation on the Ethereum network. Whether you want to trade tokens or enjoy apps like CryptoKitties, you need to pay gas to incentivize miners to package your transactions and write them into the blockchain.
Usually, Gas fees are paid in Ether (ETH), but in actual transactions, it is usually expressed in GWEI (a small unit of Ethereum), which can provide a better user experience.
Understanding the role of Gas in the Ethereum network can be compared to a car requiring gas to run. Just like a person going to a gas station and paying to fill up his car's gas tank, users of the Ethereum network pay a fee to incentivize miners to execute smart contracts. This is why many in the blockchain community refer to Ethereum (ETH) as the “fuel of the digital economy” because ETH can be converted into fuel that incentivizes miners to perform computational work on the global network.
Gas plays a vital role in the Ethereum network as it is the main incentive mechanism. It’s important to remember that miners must devote their own computing resources to executing smart contract operations, and they do so not in good faith but in order to receive compensation for providing a valuable service.
As in any proof-of-work system, the security of the network depends on the miners’ hashrate, which is primarily driven by the motivation to secure the network. The more Gas Ethereum miners can acquire, the more secure the network will be.
When considering Gas, there are two main factors: Gas Limits and Gas Price. The total cost of performing a specific operation is calculated by multiplying the Gas limit and the Gas price (Gas limit x Gas price).
Gas limit
Gas limit refers to the maximum amount of gas a user is willing to spend on computation. Certain basic calculations require a certain amount of Gas to be set aside, so wallets can often provide these estimates based on the type of operation the user is trying to perform. For example, Ethereum’s Yellow Paper stipulates that each transaction requires 21,000 Gas. Therefore, most user interfaces set this value to "Gas limit" by default.
Gas price
Gas price is expressed in GWEI, which is the unit of WEI that is easier for users to understand. 1 GWEI is equal to 10⁹WEI. This notation helps to better understand the gas cost.
As you know, the higher the gas price is set, the more likely it is that transactions will be included in the next block, as this incentivizes miners to prioritize these transactions. The default gas price in most user interfaces is 20 GWEI, which is usually enough to complete the transaction within the next few minutes. If you increase the gas price to 40 GWEI, your transaction will likely be confirmed faster as this will increase the chance of it making it to the next block.