For years now, TPS, or transactions per second, has been the go-to metric for blockchain developers trying to hype up their snazzy new networks.
Compared to Bitcoin’s seven transactions per second maximum (usually closer to four), for years, Ripple claimed that XRP was able to handle 1,500 TPS, on par with Visa’s transactions per second, although chief technology officer David Schwartz admitted last year that it has never actually hit that figure.
Solana transactions per second are claimed to be 65,000 TPS in benchmark testing, although they are closer to 3,000 TPS in the real world — and it’s “real TPS” metric is much lower again. Even newer blockchain networks now tout up to 297,000 transactions per second — “theoretically,” of course.
But how much stock should one place in the metric itself?
Various blockchain industry leaders argue that the advent of transaction bundling today makes TPS a pretty flawed measure of blockchain performance and that TPS can be — and often is — gamed.
But the reason it’s still the most common metric may be that there’s no single better alternative.
Rise and limitations of blockchain transactions per second metric
In the earlier days of crypto, TPS was the only metric that mattered, given that blockchains like Bitcoin and Litecoin mostly just sent transactions from one address to another — like when Laszlo Hanyecz spent 10,000 BTC to buy two pizzas in 2010.
At the time, TPS helped users understand how different block size choices or cryptographic algorithms from potential forks or chains could impact the speed by which their transactions could be processed. “Scaling” was mainly a debate over how many TPS a blockchain could handle, which was important if crypto was going to become the world’s digital currency.
Two flawed crypto metrics that people give way too much merit
– TPS
– TVL
— Narb (@NarbTrading) January 23, 2024
When Ethereum, with its 13 or so TPS and programmable smart…
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