Definition ∞ Decentralized System Efficiency refers to the ability of a distributed network to process transactions and operations quickly and economically. This metric evaluates how well a system utilizes its resources to achieve high throughput and low latency. It is a key factor in the scalability and practical usability of blockchain platforms.
Context ∞ Decentralized system efficiency is a constant focus in crypto news, particularly with ongoing efforts to scale blockchain networks. Innovations like layer-2 solutions and sharding aim to address the limitations of early decentralized architectures. Improving this efficiency is essential for digital assets and decentralized applications to achieve mainstream adoption and compete with traditional financial systems.