@cso7777 The performance hit in virtualization is insignificant. A virtualized systems waits for user input as good as a bare metal instance.
Most performance hits in virtualization happen when you over provision your hardware with multiple instances.
Or do you speak about emulated systems. That is something totally different.
The issue is, virtualization only helps you, when the whole system runs encrypted, that first requires hardware, that directly supports encryption.
And this does has an impact.
But what is the worse part, you need to have developers have to deal with encryption, and that is a totally different skill set.
Adding encryption to the net streams may solve many issues.
But this all can't address the input manipulation which most likely happens with smart controllers for consoles.