In the light of increasing network utilization, Ethereum miners have decided to increase the gas limit of the network from 10,000,000 to 12,500,000.
Gas fees are paid by users to make transactions and transfer smart contract data. The block size of the network is limited by the amount of gas that can be sent per block.
As such, Ethereum’s block size varies depending on the gas limit, which its protocol allows miners to adjust a bit by about 0.1% in each new block, unlike Bitcoin, which has a fixed block size.
Now, Ethereum miners are in process to increase the network's capacity by 25% to increase the number of transactions the network can process per second, making it run faster.
“In theory, this means that the Ethereum network now has the capabilities to handle ~44 transactions per second, instead of ~35,” said Bitfly, the parent company of Ethermine, an Ethereum mining pool. “Another huge milestone for the community.”
The last time a significant gas limit was increased by miners happened in Sept. 2019, from 8 million to 10 million.
Gas usage has jumped 81% YTD and nearly 10% within a day, as per Glassnode.
Block size has already started rising, with miners voting to increase the limit. Currently, it hovers around 12,000,000. The issue with this increment is that it would make the blockchain bigger as such, making it more difficult and costly to sync and run a full node along with causing some DoS concerns as well.
Ethereum core developer Péter Szilágyi had some harsh words to share about this development, which he is against.
“TL;DR: The Ethereum miners don't give a fuck about the long term health of the network nor about DoS attacks,” said Szilágyi.
“Ethereum miners and devs should really learn a bit of complexity analysis from Bitcoin devs. They at least figured out that math is a bitch that you don't screw with,” Szilágyi said.
Ethereum co-founder Vitalik Buterin also chimed with “high txfees *are* making the chain much less useful for people.”
Buterin also shared that Sparkpool reached out to him about it over a month ago, and he opposed the decision to increase the fees limit because Szilágyi did. But “the last 6 weeks of high txfees have put genuine pressure on people so I don't blame them for this decision,” he added.
Raising the gas limit means reducing the transaction fees, making the network cheaper to use. Buterin shared how he recently spent $40 just to transfer to three people. In 2020, mean gas price has increased 237%, and as we saw, two transactions spent over $5 million in fees.