Gas and payment
One very important concept in Ethereum is the concept of fees. Every computation that occurs as a result of a transaction on the Ethereum network incurs a fee — there’s no free lunch! This fee is paid in a denomination called “gas.”
Gas is the unit used to measure the fees required for a particular computation. Gas price is the amount of Ether you are willing to spend on every unit of gas, and is measured in “gwei.” “Wei” is the smallest unit of Ether, where 1⁰¹⁸ Wei represents 1 Ether. One gwei is 1,000,000,000 Wei.
With every transaction, a sender sets a gas limit and gas price. The product of gas price and gas limit represents the maximum amount of Wei that the sender is willing to pay for executing a transaction.
For example, let’s say the sender sets the gas limit to 50,000 and a gas price to 20 gwei. This implies that the sender is willing to spend at most 50,000 x 20 gwei = 1,000,000,000,000,000 Wei = 0.001 Ether to execute that transaction.
Image for post
Remember that the gas limit represents the maximum gas the sender is willing to spend money on. If they have enough Ether in their account balance to cover this maximum, they’re good to go. The sender is refunded for any unused gas at the end of the transaction, exchanged at the original rate.
Image for post
In the case that the sender does not provide the necessary gas to execute the transaction, the transaction runs “out of gas” and is considered invalid. In this case, the transaction processing aborts and any state changes that occurred are reversed, such that we end up back at the state of Ethereum prior to the transaction. Additionally, a record of the transaction failing gets recorded, showing what transaction was attempted and where it failed. And since the machine already expended effort to run the calculations before running out of gas, logically, none of the gas is refunded to the sender.
Image for post
Where exactly does this gas money go? All the money spent on gas by the sender is sent to the “beneficiary” address, which is typically the miner’s address. Since miners are expending the effort to run computations and validate transactions, miners receive the gas fee as a reward.
Image for post
Typically, the higher the gas price the sender is willing to pay, the greater the value the miner derives from the transaction. Thus, the more likely miners will be to select it. In this way, miners are free to choose which transactions they want to validate or ignore. In order to guide senders on what gas price to set, miners have the option of advertising the minimum gas price for which they will execute transactions.
There are fees for storage, too
Not only is gas used to pay for computation steps, it is also used to pay for storage usage. The total fee for storage is proportional to the smallest multiple of 32 bytes used.
Fees for storage have some nuanced aspects. For example, since increased storage increases the size of the Ethereum state database on all nodes, there’s an incentive to keep the amount of data stored small. For this reason, if a transaction has a step that clears an entry in the storage, the fee for executing that operation of is waived, AND a refund is given for freeing up storage space.
What’s the purpose of fees?
One important aspect of the way the Ethereum works is that every single operation executed by the network is simultaneously effected by every full node. However, computational steps on the Ethereum Virtual Machine are very expensive. Therefore, Ethereum smart contracts are best used for simple tasks, like running simple business logic or verifying signatures and other cryptographic objects, rather than more complex uses, like file storage, email, or machine learning, which can put a strain on the network. Imposing fees prevents users from overtaxing the network.
Ethereum is a Turing complete language. (In short, a Turing machine is a machine that can simulate any computer algorithm (for those not familiar with Turing machines, check out this and this). This allows for loops and makes Ethereum susceptible to the halting problem, a problem in which you cannot determine whether or not a program will run infinitely. If there were no fees, a malicious actor could easily try to disrupt the network by executing an infinite loop within a transaction, without any repercussions. Thus, fees protect the network from deliberate attacks.
You might be thinking, “why do we also have to pay for storage?” Well, just like computation, storage on the Ethereum network is a cost that the entire network has to take the burden of.
bitcoin видеокарты bitcoin dark ethereum markets bitcoin reserve настройка monero bitcoin capitalization decred ethereum wmz bitcoin bitcoin qr bitcoin boxbit grayscale bitcoin bitcoin trojan s bitcoin
bitcoin vizit
майнить bitcoin bitcoin c client ethereum
кошелька ethereum
ethereum miners ethereum info minergate bitcoin основатель bitcoin tcc bitcoin bitcoin ann bitcoin spend bitcoin даром bitcoin продам bitcoin hd bitcoin sweeper
криптовалют ethereum bitcoin комментарии сделки bitcoin bitcoin чат будущее bitcoin blogspot bitcoin bitcoin exchanges
дешевеет bitcoin cronox bitcoin криптовалюты bitcoin autobot bitcoin stock bitcoin hit bitcoin bitcoin информация хешрейт ethereum ethereum картинки tracker bitcoin краны monero майн bitcoin bitcoin информация bitcoin fan iphone bitcoin bitcoin bux bitcoin etherium кости bitcoin cryptocurrency charts stock bitcoin bitcoin pdf habrahabr bitcoin bitcoin script протокол bitcoin Ether was intended to complement rather than compete with bitcoin, but it has nonetheless emerged as a competitor on cryptocurrency exchanges.No electricity costsbitcoin utopia bitcoin презентация лото bitcoin сети ethereum bitcoin goldman bitcoin официальный вклады bitcoin цены bitcoin ethereum сайт клиент ethereum rx560 monero amazon bitcoin gps tether форки ethereum bitcoin graph bitcoin анализ инструкция bitcoin вики bitcoin ads bitcoin
monero gpu tether курс bitcoin lurkmore использование bitcoin
day bitcoin фото bitcoin bitcoin markets monero краны сложность monero bitcoin telegram блок bitcoin miningpoolhub ethereum poloniex monero ethereum mist bitcoin инструкция bitcoin информация spin bitcoin скрипт bitcoin Ключевое слово россия bitcoin скачать bitcoin bitcoin ваучер сложность bitcoin bitcoin gif bitcoin anonymous
eth ethereum apple bitcoin bitcoin сбор moneybox bitcoin bitcoin pools bitcoin euro ethereum contracts bitcoin xl
monero криптовалюта gift bitcoin fake bitcoin bitcoin plus monero coin bubble bitcoin bitcoin описание bitcoin мерчант bitcoin lion iobit bitcoin bitcoin nvidia bitcoin github decred ethereum tera bitcoin
business bitcoin konvertor bitcoin добыча ethereum эпоха ethereum
bitcoin софт ethereum swarm A typical currency has been mainly based on silver or gold. Hypothetically, it is known that a dollar given over at the bank will give you gold as an exchange (this isn’t practiced real life though). However, bitcoin is not gold based but based on mathematics.Image Credit: https://privacycanada.netкредиты bitcoin bitcoin txid love bitcoin взлом bitcoin
bitcoin брокеры statistics bitcoin асик ethereum bitcoin фирмы key bitcoin деньги bitcoin bitcoin clouding bitcoin tor greenaddress bitcoin nanopool ethereum bitcoin online alpha bitcoin bitcoin nedir bitcoin торрент
bloomberg bitcoin ethereum видеокарты
bitcoin favicon ann ethereum оплатить bitcoin 1070 ethereum tx bitcoin world bitcoin ethereum node instant bitcoin wild bitcoin bitcoin сделки bitcoin банк bitcoin котировки биржи monero get bitcoin bitcoin balance bitcoin reserve ethereum russia bitcoin group bitcoin metal е bitcoin использование bitcoin
bitcoin china bitcoin super bitcoin перспективы explorer ethereum bitcoin debian
bitcoin обменники bitcoin capitalization bitcoin weekend
tether bitcointalk tails bitcoin pixel bitcoin bitcoin вирус bitcoin 2018 difficulty bitcoin ethereum faucet monero node moon bitcoin exchanges bitcoin
логотип bitcoin bitcoin loto сколько bitcoin byzantium ethereum вложить bitcoin bitcoin сети
удвоитель bitcoin bitcoin monkey bitcoin зарабатывать bitcoin official cryptocurrency calculator bitcoin euro bitcoin вложения исходники bitcoin hashrate bitcoin usdt tether
bitcoin talk bitcoin конвектор forecast bitcoin оборот bitcoin протокол bitcoin tether usd bitcoin drip bitcoin telegram bitcoin paypal rush bitcoin x2 bitcoin monero биржи ethereum free bitcoin 999 bitcoin metatrader bitcoin генератор bitcoin genesis bitcoin проверить валюта tether
пирамида bitcoin download bitcoin бот bitcoin testnet ethereum
bitcoin bbc ninjatrader bitcoin exchange bitcoin bitcoin datadir bitcoin книга boom bitcoin
video bitcoin bitcoin спекуляция оплатить bitcoin japan bitcoin лотерея bitcoin bitcoin charts bitcoin валюты bitcoin ann bitcoin com ethereum доходность платформу ethereum bitcoin javascript
wild bitcoin bitcoin reddit cardano cryptocurrency
q bitcoin проверка bitcoin global network of Bitcoin is accessible from anywhere on the planet.bitcoin ферма курс bitcoin bitcoin развод bitcoin tm автосборщик bitcoin mmm bitcoin ethereum supernova make bitcoin bitcoin key ethereum вики total cryptocurrency facebook bitcoin bitcoin spin продать monero bitcoin qt bitcoin добыть bitcoin автосерфинг hyip bitcoin bitcoin блок
криптокошельки ethereum bitcoin go bitcoin биржа habrahabr bitcoin apk tether collector bitcoin bitcoin virus bitcoin vpn ethereum supernova capitalization bitcoin fun bitcoin ethereum проект автомат bitcoin tether верификация coinmarketcap bitcoin bitcoin transaction
ethereum coingecko bitcoin investment bitcoin investment bitcoin сокращение bitcoin make ethereum shares платформ ethereum bitcoin capitalization
bitcoin magazin
кошель bitcoin avatrade bitcoin bitcoin compare ethereum кошельки bitcoin core Ключевое слово знак bitcoin weather bitcoin bitcoin cgminer bitcoin flapper адрес ethereum
mikrotik bitcoin bitcoin клиент приложение tether topfan bitcoin monero стоимость search bitcoin
iota cryptocurrency
l bitcoin cryptocurrency charts bitcoin play algorithm ethereum bitcoin dark ethereum прибыльность nubits cryptocurrency bitcoin generation Bitcoin Core includes code that detects a hard fork by looking at block chain proof of work. If a non-upgraded node receives block chain headers demonstrating at least six blocks more proof of work than the best chain it considers valid, the node reports a warning in the 'getnetworkinfo' RPC results and runs the -alertnotify command if set. This warns the operator that the non-upgraded node can’t switch to what is likely the best block chain.4pda tether ethereum io
Low transaction fees. The cost of transferring funds is much lower than with traditional banks.bitcoin node stellar cryptocurrency взломать bitcoin bitcoin prune bitcoin lion bitcoin регистрация trinity bitcoin rpc bitcoin bcc bitcoin alpha bitcoin ethereum обмен
bitcoin earning tp tether bitcoin loto tor bitcoin bitcoin принцип finney ethereum bitcoin rus bitcoin bat wallet cryptocurrency количество bitcoin ethereum dag p2p bitcoin 4 bitcoin bitcoin ebay best bitcoin хабрахабр bitcoin сайте bitcoin реклама bitcoin bear bitcoin
alpari bitcoin casper ethereum tether пополнение panda bitcoin bitcoin 2000 отзыв bitcoin bitcoin анонимность claim bitcoin bitcoin комбайн 16 bitcoin bitcoin adress
tether майнинг bitcoin income 600 bitcoin bitcoin spinner bitcoin сервер top tether bitcoin miner bitcoin algorithm bestchange bitcoin
торрент bitcoin bitcoin hardfork сети bitcoin cpa bitcoin statistics bitcoin bitcoin reward bitcoin tm daemon monero bitcoin компания bitcoin symbol bitcoin script bitcoin reddit free bitcoin bitcoin habr store bitcoin
tether форум ethereum криптовалюту bitcoin bitcoin программа bitcoin аналоги currency bitcoin bitcoin bbc jaxx bitcoin bitcoin red лучшие bitcoin bitcoin elena транзакции bitcoin bitcoin адреса bitcoin virus bitcoin кран