What is a gas limit?

Imagine hiring a technician for a job and agreeing they’ll work up to a certain number of hours. The hours are the amount of work, while the hourly rate is something else. Likewise, gas measures a transaction’s computational work and the gas limit sets its ceiling.

When you send a transaction, your wallet usually estimates how much gas it will need. A simple ETH transfer requires less work than a complex interaction with a smart contract, such as a token swap that goes through several steps.

If, for example, you set a gas limit of 100,000 units and the transaction consumes 70,000, the 30,000 unused units aren’t charged. The execution fee is the gas consumed multiplied by the actual price per unit of gas. Some networks may also add extra fees.

Why it matters

The limit stops a transaction from consuming computational resources without control. For you, it’s a way to cap the work you allow to be executed, not a switch that automatically makes the transaction faster.

A higher gas limit doesn’t mean higher priority. The amount of work and its pricing are different settings. We see this distinction as the first thing to get clear for anyone looking at the fee options in their wallet.

What to watch out for

If the available gas runs out during execution, the transaction fails with an “out of gas” error. The changes it attempted are reverted, but the fee stays: in this case the entire gas limit is consumed. A failure for another reason doesn’t necessarily consume the whole limit.

Arbitrarily lowering your wallet’s estimate can therefore cost you money rather than save it. Likewise, an excessively high limit won’t fix a faulty contract or guarantee success.

You’ll also come across the block gas limit: it refers to the total gas that all the transactions in a block can consume, not just yours.