Ethereum

2024

Bitcoin

<h4><strong>This proposal is a strategic move towards optimizing how<a href="https://www.altcoinbuzz.io/?s=ethereum" target="_blank" rel="noopener"> Ethereum</a> handles transaction costs. </strong></h4> 
<p>It focuses particularly on the data aspect, which is crucial for interacting with smart contracts. Let’s discover more about this important news for Ethereum. But first, let’s see what is Ethereum’s current gas model about.</p> 
<h5><strong>Understanding the Current Gas Model</strong></h5> 
<p>Ethereum transactions currently incur two main types of gas fees: execution gas and storage gas. Execution gas covers the computational efforts required to perform transactions. Storage gas pertains to the costs associated with storing data on the blockchain in “blobs.”</p> 
<p>This structured approach helps in managing the network’s resources more efficiently but has room for improvement. Especially with the increasing complexity of Ethereum-based applications.</p> 
<blockquote class="twitter-tweet" data-width="550" data-dnt="true"> 
 <p lang="en" dir="ltr"><img src="https://s.w.org/images/core/emoji/15.0.3/72x72/1f680.png" alt="🚀" class="wp-smiley" style="height: 1em; max-height: 1em;"> <a href="https://twitter.com/hashtag/Ethereum?src=hash&amp;ref_src=twsrc%5Etfw">#Ethereum</a> gas down 93%, hitting the lowest levels since 2020! <img src="https://s.w.org/images/core/emoji/15.0.3/72x72/1f389.png" alt="🎉" class="wp-smiley" style="height: 1em; max-height: 1em;"> This means cheaper swaps and minting <a href="https://twitter.com/hashtag/NFTs?src=hash&amp;ref_src=twsrc%5Etfw">#NFTs</a> for everyone.</p> 
 <p>Yet, experts like <a href="https://twitter.com/VitalikButerin?ref_src=twsrc%5Etfw">@VitalikButerin</a> warn of future congestion and fee hikes. Miners are seeing profits dive, raising questions about decentralization. <a href="https://twitter.com/search?q=%24ETH&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$ETH</a> <a href="https://t.co/uaBkhEZ5vp">pic.twitter.com/uaBkhEZ5vp</a></p> 
 <p>— Cryptogeek (@the_Cryptogeek) <a href="https://twitter.com/the_Cryptogeek/status/1790329698334965797?ref_src=twsrc%5Etfw">May 14, 2024</a></p>
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<p><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script></p> 
<h5><strong>EIP 7706: A New Approach to Call Data</strong></h5> 
<p>Buterin’s EIP 7706 introduces a third type of gas fee solely dedicated to call data. This is the portion of a transaction that carries essential information to smart contracts. The proposal suggests a new method where Ethereum will charge separately for the data transferred during transactions. This cost will be distinct from the charges for executing contract code or data storage. This could significantly streamline the pricing model for transactions that are data-heavy but low on computational demands.</p> 
<p>The proposed model will not only add a new transaction type that categorizes fees into execution gas, blob gas, and call data gas. Also, it will integrate max_basefee and priority_fee as vectors. This means a unified adjustment mechanism could be employed for all three types of fees, potentially leading to more efficient transaction processing and reduced costs for users.</p> 
<blockquote class="twitter-tweet" data-width="550" data-dnt="true"> 
 <p lang="en" dir="ltr">Ethereum <a href="https://twitter.com/search?q=%24ETH&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$ETH</a> update and outlook: </p> 
 <p>Ethereum co-founder Vitalik Buterin has introduced Ethereum Improvement Protocol (EIP) 7706, proposing a new gas model overhaul. </p> 
 <p>This update focuses on introducing a third form of gas exclusively for call data in Ethereum transactions, aiming… <a href="https://t.co/oHx7tfqYl8">pic.twitter.com/oHx7tfqYl8</a></p> 
 <p>— alpha CAPCOM (@alphacapcom) <a href="https://twitter.com/alphacapcom/status/1790358687724318907?ref_src=twsrc%5Etfw">May 14, 2024</a></p>
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<p>&nbsp;</p> 
<h5><strong>Implications of the New Gas Model</strong></h5> 
<p>Buterin points out that with the separate charging for call data, the maximum allowable call data size per block could significantly decrease. However, this would make call data generally cheaper, according to basic economic principles, as it would likely reduce the average cost per transaction.</p> 
<p>Managing all three forms of gas through a dynamic model that adjusts fees based on real-time network conditions is expected to lead to an optimized and more cost-effective fee structure. Here is Vitalik’s post about this proposal:</p> 
<blockquote class="twitter-tweet" data-width="550" data-dnt="true"> 
 <p lang="es" dir="ltr">Multidimensional gas pricing:<a href="https://t.co/ArZb8oEzCd">https://t.co/ArZb8oEzCd</a></p> 
 <p>— vitalik.eth (@VitalikButerin) <a href="https://twitter.com/VitalikButerin/status/1788482159306543523?ref_src=twsrc%5Etfw">May 9, 2024</a></p>
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<h5><strong>Looking Ahead</strong></h5> 
<p>If EIP 7706 is adopted, it could lead to substantial changes in how developers and users approach <a href="https://www.altcoinbuzz.io/?s=ethereum+transactions" target="_blank" rel="noopener">Ethereum transactions</a>. By potentially lowering the costs for data-heavy transactions, this new model may encourage more innovative uses of Ethereum’s smart contracts and further diversify the applications running on its network.</p> 
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<h6><strong>Disclaimer</strong></h6> 
<p>The information discussed by Altcoin Buzz is not financial advice. This is for educational, entertainment, and informational purposes only. Any information or strategies are thoughts and opinions relevant to the accepted levels of risk tolerance of the writer/reviewers and their risk tolerance may be different than yours. We are not responsible for any losses that you may incur as a result of any investments directly or indirectly related to the information provided. Bitcoin and other cryptocurrencies are high-risk investments so please do your due diligence. Copyright Altcoin Buzz Pte Ltd.</p> 
<p>The post <a href="https://www.altcoinbuzz.io/cryptocurrency-news/vitalik-buterin-proposes-new-gas-fee-model-for-ethereum/">Vitalik Buterin Proposes New Gas Fee Model for Ethereum</a> appeared first on <a href="https://www.altcoinbuzz.io">Altcoin Buzz</a>.</p>

Vitalik Buterin Proposes New Gas Fee Model for Ethereum

Altcoin Buzz

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