Transaction Overhead

Definition ∞ Transaction overhead refers to the additional computational resources, network bandwidth, and storage space required to process and validate a transaction beyond the raw data of the transaction itself. This includes data for cryptographic signatures, nonce values, gas fees, and consensus mechanism-specific information. High transaction overhead can reduce network throughput, increase processing costs, and limit scalability, especially on public blockchains. Minimizing this overhead is a key goal in protocol optimization.
Context ∞ Transaction overhead is a central topic in discussions about blockchain scalability and efficiency, directly impacting network congestion and transaction fees. Developers continually seek methods to reduce this overhead through innovations like batching, compression, and more efficient cryptographic schemes. News frequently highlights efforts by various blockchain projects to lower transaction costs and improve throughput by addressing this inherent systemic cost.