⛽Ethereum Gas Explained⛽
Like every other cryptocurrency, the Ethereum network has transaction fees known as ‘gas’. Ethereum gas fees are measured in a unit called Giga Wei or Gwei for short. Wei is the smallest denomination of the ETH cryptocurrency. 1 Wei represents 1 quintillionth of an ETH, and 1 Gwei is 1 billionth of an ETH. Ethereum miners vote to set something called the gas limit, which is how much gas can be included in each Ethereum block. Even with a higher gas limit, if the Ethereum network is busy enough it means you’re going to be paying a premium to get the Ethereum miners to include your transaction in the next Ethereum block.
💱How To Save Ethereum Gas💱
Almost every single Ethereum wallet in existence lets you set your own personal gas limit before sending a transaction. The default gas fees set by these apps is not always up to date. Check websites like Eth Gas Station and Tx Street to see what the most up to date fees are. Setting your own custom gas limits using these tools can reduce your Ethereum gas costs by up to 30%. Another similar way to reduce gas fees is to transact during Ethereum’s “quiet hours”. This is between 8 to 11pm UTC. Ethereum gas costs can be up to 50% cheaper during that timeframe.
⚡Speeding Up & Reversing Transactions ⚡
Unless you’re executing a mind-melting arbitrage trade using a flash loan, sticking to the bare minimum gas limit you see on Eth Gas Station during Ethereum’s quiet hours. If you set the gas too low, your transaction could get stuck. To speed it up, you must pay at least 10% more than the previous fee, regardless of the current gas costs. If you want to reserve the stuck transaction, you can find it on Etherescan, copy the nonce number, and send yourself 0 ETH using the current gas fee along with the nonce number.
💰Gas Tokens Explained💰
Gas tokens take advantage of a function on Ethereum called the ‘storage refund’. This refunds a portion of the ETH used for gas in a smart contract when some of the data inside of it is deleted. Gas tokens are essentially junk data inside a dummy smart contract that can be destroyed in exchange for Ethereum gas. They are usually created when gas fees are low, and burned.
🤑 Chi Gas Token🤑
The Chi Gastoken has pulled an impressive 20x since the fall and continues to rise in accordance with Ethereum’s gas fees. It can be minted using the 1inch exchange, but be aware that this too costs gas. ⛓ Layer 2 Solutions ⛓ In addition to being a decentralized exchange, Loopring also allows you to transfer ETH and LRC to other users with zero fees. Getting your funds into Loopring does cost gas however, so whether you use this solution really depends on what you’re trying to do.
🛠EIP 1559 Updates🛠
Ethereum Improvement Proposal 1559 would set a base fee for Ethereum transactions and burn those fees out of circulation. A recent Tweet by Ethereum developer Tim Beiko suggests that they’re still pressing forward with EIP 1559, and that we will see it “ready to be considered for main net” sometime in March.
📜 Disclaimer 📜
The information contained herein is for informational purposes only. Nothing herein shall be construed to be financial legal or tax advice. The content of this video is solely the opinions of the speaker who is not a licensed financial advisor or registered investment advisor. Trading cryptocurrencies poses considerable risk of loss. The speaker does not guarantee any particular outcome.