code-server (vscode in gerneral with remote development extensions) does a lot of splitting of processes between the server and client. This makes normal code writing done on the client side. Intellisense still has the network delay, but is something that takes time anyway. The terminal doesnt get this benefit so they instead add local echo to make the delay a little easier to handle with [1]. I do not know if this works in code server.

[1] https://code.visualstudio.com/updates/v1_51#_local-echo