[Ethereum] Private chain: Maximum size of “data” field in an Ethereum transaction

The issue was that the chain id was not being set correctly. As a result transactions were signed with the incorrect chain id, so the sender could not be derived correctly. The fix was to also declare a config in the genesis block which specified it. An example:

"config": {
    "chainID"       : 10,
    "homesteadBlock": 0,
    "eip155Block":    0,
    "eip158Block":    0
}

In private network you can increase block gas limit by using gasLimit parameter in genesis file.

"gasLimit": "0x8000000",

gasLimit in genesis file:

A scalar value equal to the current chain-wide limit of Gas expenditure per block. High in our case to avoid being limited by this threshold during tests. Note: this does not indicate that we should not pay attention to the Gas consumption of our Contracts.

You can read about other genesis params from What does each genesis.json parameter mean?

PS: I have not tried increasing block gas limit but I guess this should work. Although you can increase block gas limit but you should not (ideally). If this is for testing purpose then it's alright. But If your smart contract consumes gas more than block gas limit, this is a concern. You could try splitting contract.