Ethereum transactions, Gas Limit and Gas Price

When you send a transaction over the Ethereum network there are two things you have to worry about, besides sending it to the correct address, the Gas Limit and the Gas Price.

To fuel a transaction you have to use Gas like in a normal car. If you want to go from A to B you need some patrol in the tank to get there. It’s the same with an Ethereum transaction and it does not matter if you send ETH or any ERC-20 compliant token.

Total transaction costs are Gas used * Gas Price.

When the network is cloggy you notice transactions are not picking up or and appear and disappear in etherscan. You can use this gas station site to find out what gas price you should use to get it picked up

The Gas Limit is the max amount of Gas that can be used in a transaction (compare it to a gas tank in your car, the larger the tank the further you can go) . Complicated smart contract can use quite a bit of Gas. For a Sift transaction to a wallet with no Sift in it you need about 3,500,000 Gas. For a simple ETH transaction 21,000 Gas is needed for most tokens 50,000 to 200,000

When you set the Gas Limit to low, the transaction will run out of Gas and failed (you wont make on a 60 liter tank all the way across the USA) and you can’t refuel.

You can set Gas Limit way to high. You only pay for the Gas used. But when a transaction fails you pay for the total limit. It happen on Etherdelta when you are competing for an order and the other guy was faster (read paid more for his Gas, see next paragraph)

In MEW you can set Gas Limit for each transaction (see image below)

Gas Price is what you pay for your Gas (or petrol in case of a car). The higher the Gas Price the more you pay for transaction and the faster it goes. I use Gas Price 0.5 Gwei, it’s is enough at the moment to get transaction done within a minute or when network is busy several minutes.

In MEW you can set the Gas Price in the upper right corner (see image below). It's standard at 21 Gwei

ALERT: Don’t make the same mistake as many have done before you. When a transaction fails because it runs out of Gas don’t increase the Gas Price you only end up paying more for the same failing transaction… Increase the Gas Limit!!!!!!