Ethereum Gas Limit Raised: Will This Help ETH Compete with Bitcoin?
Ethereum Gas Limit Raised – Ethereum has taken a significant step in improving its network capacity by raising its gas limit for the first time since the Merge in 2021. As of Tuesday morning, Ethereum’s gas limit reached nearly 32 million gas units, with an expected maximum capacity of 36 million units. This increase is the first adjustment since 2021, when the gas limit was raised from 15 million to 30 million gas units. The change was made after more than half of the validators supported the proposal, and it was enacted automatically without requiring a hard fork.
Why the Gas Limit Increase Matters for Ethereum
Gas, in the Ethereum network, refers to a unit used to measure the computational effort required to perform actions like transactions or executing smart contract functions. Raising the gas limit allows Ethereum to process more transactions or handle more complex operations in each block, ultimately improving network throughput. This adjustment helps Ethereum handle the growing demand for decentralized finance (DeFi) applications and reduces network congestion, particularly during peak usage times. Increased gas capacity will likely lead to lower transaction costs and enhance user experience on the Ethereum network.
Impact on Ethereum’s Market Position and Investor Sentiment
The recent gas limit increase is expected to have a positive impact on the Ethereum network’s utility and could help bolster investor confidence in ETH. Ethereum has been struggling to maintain its value against Bitcoin (BTC), with ETH dropping to its lowest level against BTC since March 2021. In January, one ETH was valued at only 0.03 BTC, a nearly 50% decline from the previous year. However, as Ethereum’s scalability improves with the increased gas limit, it may gain more attention from developers and investors alike, potentially boosting demand for ETH in the future.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Cryptocurrencies and stocks, particularly in micro-cap companies, are subject to significant volatility and risk. Please conduct thorough research before making any investment decisions.
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