Faster, but Still Not the World Computer

Vitalik Buterin has claimed that Ethereum will support 3,000 transactions per second after the upcoming Istanbul fork.

Will this unleash a new wave of Ethereum creativity? Might we expect a surge in traffic on the Ethereum network? Could its increase influence the price of ETH?Ethereum is slowThe conventional wisdom is that Ethereum is too slow.

The mistake people are making in saying "Ethereum is slow" is misunderstanding what a great thing, counterintuitively, it is to be slow.

If Ethereum is congested, it means that there are more people who want to pay to have Ethereum computations than there are the capacity to allow it.

Istanbul will make Ethereum's consensus a bit faster, but the term "World computer" seems hyperbolic, as it suggests there could be a singular device that handles the world's computational needs.

Ethereum's current state is more akin to a "Trust Machine" - to borrow the name of Alex Winter's blockchain documentary - than a "World computer."

This flawed reasoning is compounded by talk in the original Ethereum white paper about the creation of a Turing complete "World Computer." This suggests that there are an infinite number of applications that are able to run on Ethereum.

The need for speedIf all we are building are vending machines, lending machines and slot machines, do we really need performance? Purveyors of "Decentralized exchanges" insist that once they are fast enough, they will achieve the liquidity of "Centralized exchanges." But historically, liquidity has always moved toward high frequency trading venues - and trusted computing will always confer a performance edge versus trustless.

One of the great things about the increase in performance is simply to increase the capacity of existing apps, and to enable more similar apps to run on Ethereum.

The performance increase from Ethereum Istanbul seems unlikely to produce as-yet-unseen types of applications.