Ethereum Gas Prices: Are they ripping you off?


Ethereum Gas Fees

There have been increasing concerns from users of smart contracts about what are Ethereum gas fees and why do they exist? What are the benefits of using an on-chain smart contract versus an off-chain smart contract? These are all very good questions that programmers, investors, entrepreneurs, as well as regulators are wrestling with right now. Recently there was a proposal in the United States House of Representatives to create a Digital Cash Registry that would track the activities of American consumers when sending and receiving payments on digital currencies like etherum and ecash. The problem was that not everyone could get into the registry and that there were concerns about privacy issues.

 

Some people have suggested that by raising the gas limit on smart contracts you could prevent network congestion which is bad for the network. But why do Ethereum gas fees exist? What are the incentives for miners to add more transactions per second into their smart contracts? Why are they so high? To answer these questions we need to understand why people want to use smart contracts in the first place. People need to be able to send their money to others without waiting for a long period of time to receive it or having to pay a significant amount of "gas" which is what happens during network congestion.

 

It seems that the developers of etherum have realized this issue and that they will be adjusting the gas limit of their protocol in the near future in order to increase the speed in which transactions are verified. This will in effect make the average transaction time goes down and we might see some problems with congestion in the future but I believe that once things get back to a normal pace, we'll see a positive trend in eetherium usage. Now then, why are there Ethereum gas fees anyway? What is their purpose? Why are the developers trying to protect their buyers from large network congestion to raise the average computational effort required for a successful transaction? We still have lots of questions and not enough answers right now. Hopefully, in due time gas prices will fall and ethereum transactions will become more efficient. COMMENT and SHARE this article.


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