It is recommended to not use NTFS for USB flash drives. If you feel you must change from the FAT16 or FAT32 format that most lower capacity USB flash drives ship with (and for readyboost you do need to change the format) exFAT is the recommended format.
Because of the way it works NTFS should really only be used on physical HD's.
I don't have my fingers on articles that support my statements at the moment but I'm sure a quick google search will confirm my statements.
Note I will only be going over RB with a USB 3 device as a USB 2 device is too slow to benefit more modern machines, but all below will still apply to a usb 2 RB drive if it's an old or slow system
NTFS actually IS the best format for Readyboost IF, and only IF you are making a LARGE Readyboost drive. Anything other than NTFS, and windows limits you to 4GB, and having multiple 4GB partitions for RB is a waste as the OS would try to use them all at once. TBH if you want to seriously see Readyboost shine, get a 32GB fast USB 3.0 thumb drive
If you only have a 4GB thumb then FAT for exFat is the best because you get more space, and it has slightly faster access
Saying to people "just buy more ram" or "if you have 8GB of ram, you are doing something wrong if ReadyBoost helps you" Those are just plain ignorant statements usually made by people who really do not understand a few things: 1) Capability of Readyboost, 2) windows memory and cache management, 3) Actual speeds of SATA, USB, etc bus speed and/or the speed limitations of the devices connected to them.
1) Most current, consumer mobos are limited to 8 or 16GB of memory (and older machines, still in use, have 4 or 8GB limits). Some gamer/enthusiast mobos can do 32MB of ram, but it's NOT cheap
2) a usb 3.0 32GB thumb drive IS DIRT cheap
If you have NOTHING but SSDs in your computer, the Readyboost will do NOTHING for you. In fact, Windows won't even let you enable ready boost if this is the case as SSDs are just a VERY fast version of thumb drive technology adapted to function as a hard drive. You don't see 4TB SSDs because they would cost a fortune. So many people buy a 200-500GB SD drive as their boot/system drive and use SATA 2/3/e or eSata/Usb 3.0 drives for storage, videos etc. In this case a USB RB drive WOULD benefit any other drive except C: (unless the other devices are faster than the RB drive)
3) Windows will EASILY use 8, 16, 32 of memory for the hard drive read and write cache. It may take it time to get there, but it will use it. It also can free it up in a flash or keep the cache and swap inactive service to the swap file(s). Once no more inactive services can be swapped, the HDD cache is used for programs. And again: Most people don't have more than 8GB of memory due to price or mobo limits, and most don't have all SSD drives do to price and hw limitations.
4) a GOOD usb 3.0 thumb drive can move data at around 150-200 MegaBytes/Sec (That's faster than most Sata 3 drives can handle). In reality, most sata 2-3 drives can only move around 50-150MBytes/sec. The Sata 3 bus speed is 6Gpbs/sec not counting overhead. That's 768 MegaBytes/Sec... (not counting overhead) and NO hard drive goes THAT fast, not an SSD, and especially not a drive with platters and read/write heads! USB 3.0 is a 5Gps connection. So almost as fast as the Sata 3 buss, and again, no usb device that I know of can move data at that rate.
5) Windows 8 (probably 7 too) will do an amazing thing when it sees a fast Usb 3.0 32GB RB drive when put on a system with Sata 2-3 drives. Let's use mine for example: C: = 2TB Sata 3, D=8 TB, Raid 0 Array of 2 Sata 3 drives. I have a fairly new system. Alienware Aurora R4, 16GB RAM (max 32). I have an APC backup so I fully enable write caching and disable my write buffer flushing. This option will make windows use every drop of ram for the read and write cache (even if I had 64GB ram)
So I popped the thumb drive in, formatted it to NTFS (anything else and the RB file is limited to 4GB). It took a few hrs, but over that time, Win 8 was caching my C: drive files like MAD... but guess what did NOT get cached? D:! Why? The raid 0 array is faster than the RB drive! so Windows saw no point to cache it. Normally the RB cache is ERASE on restart and shutdown. This has made RB unpopular because it has to Recache which can slow down a system during this process. With Windows 8 fast start up option, the RB cache is NOT erased, why? When u shut down a win 8 system with this option on, it's VERY simple lol, all windows does is logs you out, then hibernates the system Since it hasn't been truly shut down, the RB cache is preserved. It will only get wiped if you restart windows, but even then, it's still worth it IMO
I also noticed something else. Windows no longer fills the system RAM with cache data now. It does a bit, 2-4GB because it no longer needs to keep the cached data in RAM for C:. Granted RAM is faster, but that cache in RAM gets nuked any time I run high memory apps. The memory will max out with cache data if I do a lot of disk writes because I have write cache on
My system runs a LOT faster now, and it takes me 60-70 seconds after I enter my password for everything to load on my desktop and start up vs 5 MINUTES before because my C: drive is no longer thrashing about
In conclusion, unless you have a TOP of the line system ( ALL SSDs, ALL SSDs and Sata 3 Raid 0 (Raid 5 may be fast enough), OR ALL raid 0/5 Sata 3 drives), then a 32GB usb 3.0 RB will GREATLY help you. YES 32-64GB RAM WOULD BE FAR FAR BETTER, by WHY would you pay THOUSANDS of dollars for 32GB more memory when you can pay 20-30$ for a good 32bit USB 3 thumb drive to boost your cache?
Do the math, do the costs, and you will see RB is VERY much worth it when done properly
Now if I had a raid 0 array on C and D (of Sata 3 drives), Windows will still allow a RB cache, but it wouldn't do me any good.
So again, it all depends on a persons rig config and budget.
But people just blindly dismiss RB, put out misinformation, and tell people not to use it... when in fact, probably about 75-80% of any Windows Vista-8 user would GREATLY benefit from a usb 3.0 RB drive