Throughput
Sovereign Assets • Layer 1s • Payment Networks
transaction processing capacity
Throughput refers to the number of transactions, operations, or data packets a blockchain network, protocol, or application can process within a specific time frame—typically measured in transactions per second (TPS). High throughput is essential for scalability, as it determines how many users and applications a network can support without congestion, delays, or high fees. Throughput is affected by block size, block time, consensus mechanism, and the implementation of scaling solutions like Layer 2 protocols and rollups.
Use Case: Ethereum’s native throughput is limited to around 15 TPS, but Layer 2 solutions like Arbitrum or Optimism increase effective throughput to thousands of TPS, enabling high-volume DeFi and gaming apps to operate smoothly.
Key Concepts:
- Layer One Protocol — The base chain whose design sets foundational throughput limits
- Layer Two Protocol — Scaling networks that boost throughput by processing transactions off-chain
- Rollups — Bundle many transactions, dramatically increasing TPS while leveraging Layer 1 security
- Sidechains — Independent networks that add parallel throughput to main chains
- Settlement Finality — The point at which increased throughput still guarantees irreversible transaction completion
Summary: Throughput measures a network’s capacity for handling activity at scale. High throughput is vital for global adoption of blockchain applications, reducing congestion, and lowering transaction costs as Web3 grows.