Web3 is a complex and evolving concept. It represents the next phase of the internet (currently web2) and it focuses on decentralized protocols, technologies and ideologies. And there is a lot to learn. We’ve launched a series that will break down some common (and not so common) concepts and how they fit into the web that is internet 3.0.
Ethereum has become a leader in the world of decentralized platforms, enabling smart contracts and decentralized apps and games. Central to its operation are gas fees, which are payments made by users to facilitate transactions on the Ethereum blockchain. However, these fees have been problematic due to their fluctuating nature and potential to deter new users. But what are gas fees exactly, why do we need them and how can we get around it?
Let’s break down gas fees, how they can be worked around, and how our Account-Abstraction-As-A-Service Cometh Connect can help.
Gas fees are essential payments on the Ethereum network. They compensate for the computational energy required to process and validate transactions. Every action on Ethereum, from transferring ETH to executing a smart contract, requires computational effort, which is measured in units called “gas.” The total fee for a transaction is determined by two factors: the gas limit (the maximum amount of gas a user is willing to spend) and the price, which is the amount a user is willing to pay per unit of gas. Similar to transaction fees at banks, or the volatility of the stock market — gas fees can be chaotic and can quickly become very, very expensive.
Despite its price, these fees are important, and serve a double purpose: They incentivize miners, who validate and add transactions to the blockchain, to process transactions efficiently. This is critical as they play a pivotal role in the functioning, security, and evolution of the network. Without the miners, the Proof-Of-Work consensus mechanism would fail, rendering the network insecure and unable to process transactions.
And at the same time, they ensure that users pay a fair price for the network’s computational resources. However, when the network experiences high traffic, users often increase their gas prices to ensure their transactions are processed promptly. This can lead to a surge in overall gas fees, making transactions expensive and potentially turning off users.
Web3, the decentralized version of the internet, offers users control over their data and transactions. However, the transition to this new platform is not without challenges. New users often find it difficult to understand the complexities of digital wallets, private keys, and especially gas fees. The potential for high transaction costs can further dissuade users from engaging with web3 platforms. While web2 incurs certain costs, not every action has a fee. On Ethereum, there are fees for all actions, including transferring ETH, interacting with smart contracts, or deploying new contracts. Combine the complexity of the new concepts and ideologies in the blockchain with the necessity of new programs and hardware, add on the high price, and it’s no wonder there is a serious onboarding problem, despite the exciting advantages of web3.
One of the innovative solutions to the gas fee challenge is the introduction of Layer 2 scaling solutions. These solutions help reduce gas fees by taking transactions off the base Ethereum layer. Instead of processing every transaction on the main Ethereum network, Layer 2 solutions bundle multiple transactions and settle them all at once on the Ethereum blockchain at a later time. This batching process significantly reduces the overall gas fees as multiple transactions are processed as a single batched transaction. Layer 2 solutions, such as ZK Rollups and Optimistic Rollups, rely on cryptographic proofs to ensure the validity of transactions, ensuring security while reducing costs.
Built upon a layer 2, Cometh Connect is an Account-Abstraction-As-A-Service biometric smart-wallet service designed to streamline and simplify the user experience in web3. It allows users to create and manage blockchain wallets using their biometric data, such as fingerprints or FaceID, which is stored securely on their devices, whether it’s a phone or computer. One of the standout features is the ability to handle sponsored transactions, where decentralized applications (dApps) cover the transaction fees, effectively making gas fees invisible to the end-user. This means users won’t have to deal with the complexities of gas fees when using their favorite dApp or game. By abstracting away the traditional challenges associated with web3 wallets, such as understanding private keys and gas fees, Cometh Connect simplifies the onboarding process for newcomers to the decentralized web, offering a more intuitive and user-friendly experience — a web2 experience within web3.
Connect’s approach to simplifying transactions on the Ethereum network represents a significant step forward in making web3 more accessible. By addressing the challenges of gas fees and providing a seamless transaction experience, Connect and other tech will play a crucial role in the broader adoption of decentralized platforms by prioritizing user experience.
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