We all know how blockchain smart contracts have pretty much taken over the lives of all modern tech-based businesses. Be it for handling escrow management or disbursing insurance payments on time, smart contracts are the order of the day.
Ethereum, as we also know, is THE platform for smart contracts. So, today we try to figure out how much it costs to deploy s smart contract on the Ethereum platform.
To calculate, you must first understand a basic concept which forms the basis of this calculation.
This basic premise is the “gas” in Ethereum.
You May Also Read: What is “Gas” in Ethereum?
“Gas” in Ethereum: Basics
“Gas” in Ethereum terminology refers to the basic fuel that powers the network, be it for deploying smart contracts or for hosting dApps (decentralized applications) on the network.
To calculate the transaction fee on any task, you simply multiply the gas limit by the gas price. Now, this amount is usually divided among the miners. So, they naturally prefer to work hard when the gas price is high. If you are hoping for a lower gas price, then you will simply have to wait a little longer.
For fast and smooth transactions, you would need to pay a higher gas price. You can find all details concerning the prevailing gas price rates at https://ethgasstation.info .
Gas is calculated in units of Wei or Gwei. For reference and understanding, we can tell you that 5 Gwei correspond to 0.00000001 ETH.
How To Calculate The Cost of An Ethereum Smart Contract?
To calculate, you must know the media gas price (at the time of writing, it is 9 Gwei), the gas limit (usually 21000 gas for a smart contract) and the market price of Ethereum ($147.83 at the time of writing) to be able to calculate how much you will have to shell out for deployment.
Now, an old calculation, modeled on the Rinkeby testnet, pegged the cost of deploying a smart contract and running associated transactions at around $0.08.
Now, what you must bear in mind is that this calculation was done back in 2017, when the price of ETH was $300. Today it is a little less than half that price.
So, while calculating, you must take that into account as well. Moreover, that calculation was done with the gas price being 20 Gwei. Now, remember, you must determine your own gas price depending on your needs and calculate accurately.
Whoa! That Cheap? Is that the full cost of Deploying An Ethereum Smart Contract?
Well, we are sorry to disappoint but no, actually hosting a smart contract costs far more than that. Auditing and testing can cost a bomb.
You cannot even hope to get away without conducting those because smart contract codes often have bugs that can open it up to huge security concerns.
With all those costs included, a simple, basic smart contract will cost you a little under $7500 while an elaborate advanced one can cost as much as $45000.
So, you see, you really have to save up for running a good smart contract.
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