Ethereum has raised its gas limit for the first time since 2021, marking a significant milestone in its post-Merge evolution. This adjustment, implemented without a hard fork, enhances Ethereum’s transaction processing capacity and could improve its appeal among investors.
Quick Take
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Ethereum’s gas limit has increased to 32 million units, with a maximum anticipated threshold of 36 million, allowing for higher transaction throughput and lower congestion.
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The upgrade was implemented automatically, with over half of validators signaling support, avoiding the need for a hard fork.
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Vitalik Buterin confirmed the Pectra upgrade in March 2025, which will double Layer 2 capacity by increasing the blob target from three to six.
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Ethereum’s price remains volatile, falling below $2,800 despite the upgrade, but investor interest is growing with $83.6 million in ETF inflows and over 250,000 ETH withdrawn from exchanges.
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Developers are working on further optimizations, including EIP-4444 for historical data management, stateless architecture, and client performance improvements.
Ethereum Gas Limit Increased to 32 Million
Ethereum gas limit crosses 32 million | Source: X
Ethereum validators reached a consensus to increase the network’s gas limit, pushing it to nearly 32 million gas units, with a maximum anticipated threshold of 36 million units. This marks the first such increase since the transition to Proof-of-Stake (PoS) in 2022 and the first since Ethereum’s last gas limit adjustment in late 2021 when it jumped from 15 million to 30 million gas units.
The decision was enacted automatically after more than half of Ethereum’s validators signaled their approval. This increase allows more transactions and complex operations per block, reducing congestion and potentially lowering transaction fees. With Ethereum’s gas limit rising, the network’s efficiency and ability to support decentralized finance (DeFi) applications may see significant improvement.
How the Gas Limit Increase Affects Ethereum Users
Gas on Ethereum refers to the unit measuring computational work required for transactions and smart contract operations. The gas limit represents the total amount of gas that can be used in a single block. If transactions exceed this limit, they must either wait for the next block or compete for inclusion based on gas fees.
With a higher gas limit, Ethereum can accommodate more transactions per block, reducing bottlenecks during peak usage periods. This is expected to enhance user experience, prevent network slowdowns, and help Ethereum maintain its competitive edge against alternative blockchains like Solana, which offer lower transaction fees.
Read more: Solana vs. Ethereum: Which Is Better in 2025?
Vitalik Buterin Highlights Pectra Upgrade for Ethereum Scalability
Vitalik Buterin’s expectations from Pectra upgrade | Source: X
Ethereum co-founder Vitalik Buterin welcomed the gas limit increase as a step toward greater scalability. He also provided key insights into the upcoming Pectra upgrade, expected in March 2025, which will further enhance Ethereum’s capacity.
Pectra will increase the blob target from three to six, effectively doubling the transaction capacity for Layer 2 (L2) networks. "Blobs" are large data packets used by L2 networks for temporary storage, allowing them to process transactions more efficiently without overloading the Ethereum mainchain.
Buterin has suggested making the blob target staker-voted, which would allow adjustments to be made dynamically based on technological advancements without requiring hard forks. This aligns with Ethereum’s broader goal of maintaining a decentralized and adaptable governance model.
Ethereum Price Declines Under $2,800 Despite Upgrade
ETH/USDT price chart | Source: KuCoin
Despite the positive network improvements, Ethereum’s price has struggled against Bitcoin. The ETH/BTC ratio recently fell to 0.03, the lowest level since March 2021, reflecting Ethereum’s continued underperformance relative to Bitcoin. The ratio peaked at 0.08 in 2022 but has since trended downward.
Ethereum’s price also dipped below $2,800 following the gas limit increase. This decline came amid broader market volatility, but investors showed renewed interest in ETH through inflows into Ethereum ETFs (Exchange-Traded Funds), which recorded $83.6 million in net inflows. Additionally, over 250,000 ETH were withdrawn from exchanges, signaling accumulation by long-term holders.
Ethereum 2.0 Roadmap to Focus on Enhancing Efficiency and Adoption
Ethereum developers are actively working on several network optimizations, including Ethereum Improvement Proposal (EIP) 4444, which aims to enhance efficiency by reducing historical data storage requirements. Other ongoing improvements focus on achieving a more stateless architecture, optimizing client performance, and increasing network decentralization.
With the gas limit increase already in effect and the Pectra upgrade on the horizon, Ethereum is poised for greater scalability and efficiency. These enhancements could help Ethereum reclaim investor confidence and reinforce its status as the leading smart contract platform.
Read more: Ethereum 2.0 Upgrade: A New Era for Scalability and Security
Conclusion
Ethereum’s first gas limit increase in over three years represents a crucial milestone in its post-Merge journey. By allowing for greater transaction throughput, reducing congestion, and preparing for the scalability enhancements of the Pectra upgrade, Ethereum is setting the stage for long-term network improvements. While ETH’s price struggles against Bitcoin, growing investor interest and technical upgrades could bolster Ethereum’s long-term adoption and utility.
Stay updated with KuCoin News for the latest developments in Ethereum’s evolution and broader cryptocurrency market trends.
