Better performance vs better gameplay

So i have these two algorithms that deal with the collision in my game.

method one activates only the top layer of blocks for collision. This saves literally does not drop the frame rate at all and can be used in rendering many blocks at one time. On the other hand, I can’t update the terrain collisions without a serious drop in the frame rate.

method two has all of the blocks activated for collision at on time. This enables me to update the terrain in real time but cuts the overall frame rate in half and cannot be used with rendering a lot of blocks at one time. It also helps world generation times.

It is also important to say that this is a really unoptimized version of my game. All of the blocks are still being rendered at one time.

My question is which method should I use method 1 or method 2. I don’t need any code or anything.

Thanks