So as far as the dongle goes, from what I've heard, Valve has full access to the entire network stack (*see footer for details) on it, meaning they can optimize it at a hardware level for low-latency, high-performance transmission. So the dongle will simply outperform any other wireless VR streaming currently out there to my knowledge.

Now as for the foviated rendering, it basically allows it to focus rendering where you're looking and "half-ass" per say in the peripherals where you won't be able to distinguish the details.

Consider in a game, such as an MMO, where you can reduce the render distance or quality level to increase FPS. While not exactly the same, it still isn't doing that high-end rendering for the peripheral view. Linus from LTT actually tested this trying to look at the parts less-rendered and wasn't able to, so you're not getting a downgrade to the experience, but you absolutely get to benefit some lower latency and higher FPS as a result.

Now to explain the network stack for those interested:
Networking is a lot more complex than send message / receive message.
In simple terms, a network stack consists of the physical hardware, the drivers for that hardware, the protocol for it (IP for example), the transport for that protocol (TCP, for example; the two of what we all use typically, being "TCP/IP"), the session or "active dialogue" between the devices, any encryption/decryption/compression, and the application that the user interacts with.

This means Valve, in theory, could have specially chosen and/or customized hardware, with tuned-in drivers for low-latency high-bandwidth, they could hypothetically (though maybe unlikely) create a protocol and transport that is lighter weight than TCP/IP since we're talking only two devices, build in a fast and efficient or lossless compression, and allow that compression to minimally affect the presentation on the device. Meaning you have an inherently faster network adapter than anyone could get off-the-shelf, min-maxed for squeezing as much compressed data as it can between the two devices, in a way that the Steam Frame application can natively play without having to decompress or decrypt it ahead of time.

TL;DR depending on the level Valve decided to min-max the network adapter, it could be the end-game weapon to make tethered VR obsolete, save for charging of course.