IBAX's Trading Speed

TPS refers to the number of transactions processed by the system per second, and is one of the most important metrics to measure the capacity of a blockchain system. With the development of blockchain, the transaction blocking problem of some mainstream blockchain projects has become more and more serious, resulting in many applications not being able to be implemented in the blockchain ecosystem. Many projects are currently focusing on solving this problem to achieve higher and faster TPS. However, the blind pursuit of high TPS is short-sighted, and many blockchain projects still use TPS as a "selling point" to attract investors' attention, creating the illusion that the higher the TPS, the better the system performance, which has a negative impact on the development of blockchain technology and industry. The higher TPS in a blockchain does not mean how good the performance is in that blockchain; TPS is always impossible to be separated from security and reliability.

In the life cycle of a blockchain system, the factors affecting its TPS can be broadly divided into two categories: intrinsic and extrinsic. Intrinsic factors include system consensus mechanism, block parameter setting, transaction process optimization, node configuration, cryptographic algorithm, etc. Extrinsic factors include resource allocation, testing and verification environment, etc.

Consensus mechanism plays a determining role in blockchain system TPS. Here is three mainstream blockchain consensus mechanisms and a comparison of the features of blockchain projects based on these consensus mechanisms. Bitcoin and Ethereum based on POW consensus both have TPS below 30, high security and high decentralization; kafka-based super ledger project, although the TPS can reach 10,000, but the security and decentralization is low. As a result, the TPS of blockchain systems based on different consensus mechanisms may have a large difference. Different TPS will also have an impact on the security and decentralization of that blockchain. The obsessive pursuit of high TPS will definitely lead to a decrease in security and stability, and may also lead to excess performance, which is obviously detrimental to the development of the blockchain project itself and will eventually lose its investment value.

Blockchain is not created for mindless high TPS, if there is no market demand, even if your TPS is high it is not attractive, like building a 16-lane wide and flat road in a small village, there are not so many cars to drive, there is no demand, but the resources to build the road are wasted.

There is a trilemma in the blockchain, i.e., no matter what consensus mechanism is used, it cannot simultaneously combine the three requirements of scalability, security, and decentralization. When the system pursues high TPS, it will inevitably sacrifice part of the security or cause the system to be too centralized. Taking the Consortium Blockchain chain as an example, although it achieves low energy consumption and high performance, it results in an overly centralized system. Bitcoin, on the other hand, is less efficient with a TPS order of magnitude in the single digits, but it achieves a high level of decentralization, the project has been running stably for 11 years, and its security is highly recognized by the market.