Today I will be writing about how you can go about efficiently determining the amount of gas (gwei) that you are willing to pay to conduct transactions on the Ethereum Network. This will be especially important if you intend to get into Ethereum gaming, Cryptocurrency investment or into the habit of purchasing items online with your Ethereum or certain ERC-20 tokens.
How to determine the gas price (gwei) you should use:
Firstly, you should ask yourself three questions.
1. How quickly do I want my transaction to be processed?
2. How much gwei am I willing to spend in transaction costs?
3. Is the Ethereum network currently congested?
Your answer to the questions above will ultimately determine how much you should pay in transaction fees.
Because transaction speeds & how much you need to spend on gwei to obtain that speed is ultimately determined by the amount of congestion in the Ethereum network, it would be very difficult to find the correct values on your own.
Thankfully, there are third-party sites like ethgasstation which provides ‘Recommended Gas Prices’ and a ‘Gas-Time-Price Estimator’ which makes it easier to find the right amount of gwei to use depending on your situation.
Looking at the screenshot above, we can see that if a user were to make a transaction and set a Gas Price of 1, they could expect to wait around 5 minutes & 15 seconds for their transaction to process. For a standard transaction, the Tx (transaction) fee costs roughly 0.017 cents. The price can vary however depending on the maximum amount of ‘Gas Used’.
Typically, if you wish to make a transaction with a ‘Smart Contract’, the amount of Gas required to conduct a transaction is a lot higher compared to standard transactions where Ethereum merely exchanges hands. Generally I don’t touch the ‘Gas limit’ unless the company or user who I am transferring Ethereum to instructs otherwise.
I’ve also found that I can set the gas price to 0.3 gwei and till have my transaction successfully process if I’m not fussed about transaction times and if the Ethereum network is not congested.
If you are unsure about some of the terminology used, I highly recommend MyEtherWallets ‘What is Gas?’ article which explains it very well.
How do you go about determining the amount of gwei that you spend per transaction? Please let us know in the comments below!
Until we meet again,
Grant