There are two major limitations to device speed – capacitance and distance. When a transistor turns on, the signal it generates has to reach the next transistor. First, current has to flow through the transistor to charge up the capacitance of the link to that transistor, and the next transistor – so the smaller, the better – and the signal has to travel the length of the link – so the shorter the better.
By making transformers smaller, the links become both smaller and shorter, so devices can work faster.
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