Ethereum’s gas mechanism serves as the fuel for executing transactions and smart contracts on the network. In February 2025, the gas limit was increased from 30 million to 36 million units, marking the first adjustment since 2021. This change allows for more complex operations within each block, enhancing the efficiency of smart contracts.
Building on this, Ethereum Improvement Proposal 9698 (EIP-9698) has been introduced, aiming to scale the gas limit to 3.6 billion over the next four years. This proposal seeks to exponentially increase the network’s capacity, potentially enabling up to 2,000 transactions per second, thereby significantly improving scalability and performance for smart contracts.
Understanding Ethereum Gas: The Basics
Gas in Ethereum represents the computational effort required to perform operations, such as executing smart contracts or processing transactions. Each operation consumes a specific amount of gas, ensuring that network resources are allocated efficiently and preventing abuse.
Gas Limit vs. Gas Price
- Gas Limit: This is the maximum amount of gas a user is willing to consume for a transaction. It sets the upper bound for computational resources used.
- Gas Price: This denotes the amount of Ether a user is willing to pay per unit of gas. It influences the transaction’s priority in the network.
Impact on Smart Contract Operations
The gas limit directly affects the complexity of smart contracts that can be executed. A higher gas limit allows for more intricate and feature-rich contracts to run efficiently. Conversely, the gas price impacts the cost of executing these contracts, influencing user behavior and network congestion.
Recent Developments: Gas Limit Increase to 36 Million
Ethereum’s First Gas Limit Increase Since the Merge
On February 4, 2025, Ethereum’s network underwent a significant change: the gas limit was increased from 30 million to 36 million units. This marked the first adjustment since the network’s transition to Proof-of-Stake (PoS) in 2022 .
Community and Validator Support
The decision to raise the gas limit wasn’t made lightly. It required the backing of the community and validators. Notably, 52% of Ethereum validators supported the increase, surpassing the necessary threshold for implementation . This consensus underscores the collective commitment to enhancing the network’s scalability and efficiency.
Immediate Effects on Network Performance
The increase in the gas limit has tangible implications:
- Enhanced Throughput: With more gas available per block, Ethereum can process a higher number of transactions, reducing congestion during peak times.
- Improved Smart Contract Efficiency: Developers can now deploy more complex smart contracts without the need to split them into multiple transactions.
- Potential Fee Reduction: By accommodating more transactions per block, the network may experience a decrease in transaction fees, benefiting users .
EIP-9698: A Proposal for Exponential Gas Limit Growth
Overview of EIP-9698 and Its Objectives
Ethereum researcher Dankrad Feist introduced Ethereum Improvement Proposal 9698 (EIP-9698), aiming to exponentially increase the gas limit over the next four years. The proposal suggests a deterministic schedule to raise the gas limit from 36 million to approximately 3.6 billion units by 2029 .
Proposed Schedule: Tenfold Increase Every Two Years
The plan involves:
- Initiation: Starting around June 1, 2025, at Beacon-chain epoch 369017.
- Incremental Growth: The gas limit would increase by a small, preset amount every epoch, effectively achieving a tenfold increase every two years.
- Final Target: By 2029, the gas limit would reach 3.6 billion units, a 100x increase from the current limit .
Expected Impact on Transactions Per Second (TPS)
If implemented, EIP-9698 could significantly enhance Ethereum’s transaction capacity:
- Current TPS: Ethereum processes approximately 15-20 transactions per second.
- Projected TPS: With the proposed gas limit increase, the network could handle over 2,000 TPS, aligning Ethereum’s performance with that of high-throughput competitors like Solana .
Technical Implications of Increased Gas Limits
Unlocking Smart Contract Potential
With Ethereum’s gas limit increased from 30 million to 36 million in February 2025, developers now have more room to execute complex smart contracts within a single transaction. This enhancement reduces the need for multi-step interactions, streamlining processes and improving efficiency.
Challenges: Bigger Blocks, Bigger Responsibilities
While larger gas limits allow for more data per block, they also result in increased block sizes. This can strain node resources, leading to longer propagation times and potential synchronization issues. Nodes with limited bandwidth or processing power may struggle to keep up, risking network decentralization.
Mitigation Strategies: Gradual Implementation and Optimization
To address these challenges, Ethereum’s approach includes gradual gas limit increases and client-side optimizations. Proposals like EIP-9698 suggest a 100x gas limit increase over four years, allowing developers and node operators ample time to adapt and optimize their systems . Additionally, improvements in client software and the adoption of stateless clients can help manage the increased load.
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Fusaka Hard Fork: Quadrupling the Gas Limit
Introducing the Fusaka Hard Fork
Scheduled for late 2025, the Fusaka hard fork aims to quadruple Ethereum’s gas limit to 150 million, as outlined in EIP-9678 . This significant increase is designed to enhance Layer 1 scalability without introducing new features, focusing on improving transaction throughput and reducing costs.
Expected Benefits
By increasing the gas limit, Fusaka is expected to alleviate network congestion, enabling more transactions per block and lowering fees. This move supports the growing demand for decentralized applications and Layer 2 solutions, enhancing the overall user experience.
Potential Challenges
However, such a substantial increase also poses risks. Higher gas limits can expose bugs in client software, requiring extensive testing and updates. Developers anticipate the need for additional Ethereum Improvement Proposals (EIPs) to address these issues and ensure a smooth transition .
Impact on Smart Contract Development
Unlocking New Possibilities for Developers
With Ethereum’s gas limit increasing from 30 million to 36 million units in February 2025, and plans underway to raise it further to 60 million, developers now have more room to innovate. This expansion allows for the execution of more complex smart contracts within a single transaction, reducing the need to split operations across multiple transactions.
Optimizing Gas Usage in Contract Design
While the increased gas limit offers more flexibility, efficient gas usage remains crucial. Developers should consider:
- Efficient Coding Practices: Writing optimized code to minimize unnecessary computations.
- Modular Contract Design: Breaking down contracts into smaller, reusable components.
- Regular Audits: Conducting audits to identify and eliminate gas-intensive operations.
Tools and Best Practices for Gas Management
To monitor and manage gas consumption effectively, developers can leverage tools such as:
- Tenderly: Provides real-time monitoring and debugging capabilities.
- Etherscan’s Gas Tracker: Offers insights into current gas prices and usage trends.
- Hardhat: A development environment that allows for gas usage reporting during testing.
Effects on Decentralized Applications (dApps) and Layer 2 Solutions
Enhancing dApp Performance and User Experience
The increased gas limit directly benefits dApps by allowing more operations per transaction. This improvement leads to:
- Reduced Transaction Costs: Lower gas fees make dApps more accessible to users.
- Improved Responsiveness: Faster transaction processing enhances user experience.
- Expanded Functionality: Developers can implement more complex features without worrying about gas limitations.
Implications for Layer 2 Solutions
Layer 2 solutions, such as rollups, benefit from the increased Layer 1 gas limit by gaining more space for data availability and settlement proofs. This expansion can lead to:
- Lower Layer 2 Fees: Reduced costs for users transacting on Layer 2 platforms.
- Higher Throughput: Ability to process more transactions per second.
- Enhanced Security: Improved integration with Layer 1 enhances the security of Layer 2 solutions.
Unlocking New Use Cases in DeFi, NFTs, and Gaming
The combination of increased gas limits and improved Layer 2 solutions paves the way for innovative applications in various sectors:
- DeFi: More complex financial instruments and services can be developed.
- NFTs: Enhanced capabilities for minting and trading non-fungible tokens.
- Gaming: Development of more sophisticated blockchain-based games with richer features.
Business Benefits: Lower Costs and Enhanced Scalability
Reduced Transaction Costs
The gas limit increase allows more transactions per block, effectively reducing network congestion. This change has led to a 10–30% decrease in gas fees, depending on network activity . For businesses, this translates to lower operational costs, especially for those relying heavily on smart contracts.
Improved Scalability
With higher gas limits, Ethereum can process more complex operations within a single block. This enhancement supports the development of more sophisticated decentralized applications (dApps) and services, enabling businesses to scale their operations more effectively on the Ethereum network.
User Experience Enhancements: Faster Confirmations and Lower Fees
Quicker Transaction Confirmations
The increased gas limit has led to faster transaction processing times, improving the overall user experience. Users now experience quicker confirmations, which is particularly beneficial during periods of high network demand .
Lower Transaction Fees
As mentioned, the reduction in gas fees directly benefits users by making transactions more affordable. This cost-effectiveness encourages more users to engage with Ethereum-based applications and services.
Adapting to the Evolving Ethereum Network
Embracing Layer 2 Solutions
Businesses and users should consider integrating Layer 2 scaling solutions, such as Optimism or Arbitrum, which offer even lower fees and faster transaction times. These solutions complement the increased gas limits by further enhancing scalability and efficiency.
Staying Informed on Network Upgrades
Ethereum’s roadmap includes proposals like EIP-9698, aiming to exponentially increase the gas limit over the next four years . Staying updated on such developments allows businesses and users to anticipate changes and adapt their strategies accordingly.
Conclusion
Ethereum’s gas limit increase is more than just a technical upgrade—it’s a strategic shift toward greater scalability, cost-efficiency, and smart contract innovation. By enabling more complex operations and lowering transaction costs, this enhancement strengthens Ethereum’s position as a preferred platform for developers and businesses alike. It opens new possibilities for building smarter, more responsive decentralized applications while improving the overall user experience. As the Ethereum network continues to evolve with proposals like EIP-9698 and the upcoming Fusaka hard fork, businesses that adapt early stand to gain a competitive edge. Blockchain App Factory provides industry-leading Ethereum Smart Contract Development Service, helping you build scalable, efficient, and future-ready blockchain solutions tailored to your business needs.
