Gas Limit
The maximum amount of gas units a user is willing to spend on a single transaction on Ethereum. If a transaction requires more gas than the limit allows, it fails and reverts, but the gas spent up to that point is still consumed. Setting the gas limit too low causes failed transactions; setting it appropriately prevents runaway costs from buggy contracts.
“A simple ETH transfer needs 21,000 gas, so setting a gas limit of 21,000 is sufficient. A complex DeFi transaction might need 300,000 gas — setting the limit to 200,000 would cause it to fail.”
Gas
A unit measuring the computational effort required to execute operations on the Ethereum network. Users pay gas fees in ETH to compensate validators for processing transactions. Since EIP-1559, gas fees consist of a base fee (burned) and an optional priority fee (tip) to incentivize faster inclusion.
Gwei
A denomination of Ethereum's native currency ETH, equal to 0.000000001 ETH (one billionth, or 10⁻⁹). Gwei is the standard unit for expressing gas prices on Ethereum. The name comes from 'giga-wei,' where wei is the smallest possible unit of ETH (10⁻¹⁸).
Transaction Fee
A payment made to network validators or miners for processing and confirming a transaction on the blockchain. Fees incentivize block producers and prevent network spam. Fee structures vary by blockchain — Bitcoin uses a fee market based on transaction size in bytes, while Ethereum uses gas-based pricing. During congestion, fees increase as users bid for limited block space.