What to Expect After the Etna Upgrade

This guide outlines the operational impact on existing network participants expected from the activation of the AvalancheGo "Etna" upgrade.

Vocabulary, New and Old

• L1: An Avalanche Layer 1 Network. An L1 is a sovereign network that has its own dynamic set of validators, rules for network participation, and defines its own validator rewards incentives.
• L1-validator: A validator that only validates an Avalanche layer 1 blockchain. These validators are not required to stake 2000 AVAX, or validate the Avalanche Primary Network. They instead pay a continuous fee in order to participate in L1 validation.
• ACP-77: The Avalanche Community Proposal that outlines a new framework for creating low-cost, independent blockchains that can easily interoperate with each other. You can read the full proposal here.
• The Primary Network: The Avalanche X,P, and C-Chains, a.k.a. the 3 primary blockchains that most validators currently sync on Avalanche Mainnet.

What is Changing?

Subnets Are Now Called L1s

Avalanche Subnets are being rebranded as Avalanche L1s. Unlike layer 2 blockchains, layer 1 blockchains operate independently without relying on other systems for their core functions. They manage their own consensus mechanisms, transaction processing, and security protocols directly within their own networks.

Subnets have always operated this way, scaling Avalanche's network horizontally instead of compounding dependencies by requiring chains to roll down to other networks.

For Validators

L1 validators will no longer be required to sync the Primary Network’s X or C-Chain, drastically reducing the cost of operating a validator.

L1 validators will no longer be required to stake 2000 AVAX. Instead they will pay a substantially cheaper continuous fee calculated based on the number of L1 validators. The AVAX-denominated fee is a nominal amount per second and provides significant cost-savings for L1 validators.

For New L1s

The ownership of validator set management will be moved from the P-Chain to individual L1 ValidatorManager smart contracts.

• Essentially, validators will be managed by the L1s themselves instead of the P-Chain.

Sovereign L1s can easily be launched on Avalanche with a dynamic set of validators whose staking logic is defined and enforced by a ValidatorManager smart contract deployed by the L1 creator. The smart contract deployed can enforce any network rules the creator desires, including but not limited to:

• A permissionless proof-of-stake blockchain where network participation is not controlled by any centralized authority
• A permissioned proof-of-authority blockchain where the validator set is controlled by a consortium or centralized authority

If the L1 is permissionless, the validator earns staking rewards by staking the asset specified by the L1; If the L1 is permissioned, the validator is controlled by a party specified by the L1 Owner and does not earn any rewards.

For Existing L1s

Existing Avalanche Subnets that wish to remove the 2000 AVAX per validator requirement will need to convert their Subnet’s control from a P-Chain Owner Key to a ValidatorManager smart contract via the workflow outlined in ACP-77.

• A detailed guide on how to convert existing L1s will be released prior to Testnet activation.

Existing L1s do not need to be converted if their validators continue to stake 2000 AVAX and validate the Primary Network.

What is Staying the Same?

For Validators

If you want to earn staking rewards for validating the Avalanche Primary Network, you will still need to stake 2000 AVAX per validator.

Existing validators can continue operating as they have before, and do not require any action. Updating to the latest release of AvalancheGo will not affect their operation.

For L1s

Existing Avalanche L1s are not required to convert their pre-Etna validators to L1-only-validators; they will continue to operate as before.

All L1s will still be able to interoperate using Avalanche Warp Messaging (Avalanche ICM) and Teleporter (Avalanche ICM Contracts), regardless of how or when they were created.

What Technical Changes Will be Included?

While driven by ACP-77, this upgrade will include many other feature additions outlined thoroughly in the following Avalanche Community Protocols:

ACP-77: Outlines a new validator management framework for Avalanche L1s, creating low-cost, natively-interoperable blockchains.

ACP-103: Introduces a dynamic fee mechanism to the X-Chain and the P-Chain, previewing a future transition to a multidimensional fee mechanism.

ACP-118: Proposes a standard AppRequest payload format type, simplifying potential AWM signature aggregation implementations.

ACP-125: Reduces the minimum base fee on the Avalanche C-Chain from 25 nAVAX to 1 nAVAX.

ACP-131: Brings the EVM opcodes introduced by the Cancun Upgrade to the Avalanche C-Chain and Subnet-EVM.