KEY TAKEAWAYS
- The Avalanche Network will implement the ‘Etna’ upgrade on December 16, 2024, introducing significant changes to enhance network functionality and reduce transaction costs.
- The upgrade includes ACP-125, which drastically reduces the C-Chain minimum base fee, making transactions more affordable during low network activity.
- Dynamic fee mechanisms are introduced to the P-Chain, allowing fees to adjust based on network load, improving transaction cost efficiency.
- ACP-77 introduces new transaction types for L1 validator management, reducing economic barriers for creating and operating blockchains.
The Avalanche Network is set to implement its latest upgrade, known as the ‘Etna’ upgrade, on the Mainnet at 12 PM ET (5 PM UTC) on December 16, 2024. This upgrade, which was successfully tested on the Fuji Test Network on November 25, 2024, includes several Avalanche Community Proposals (ACPs) aimed at enhancing network functionality and reducing transaction costs.
The Etna upgrade introduces significant changes, including ACP-125, which reduces the C-Chain minimum base fee from 25 nAVAX to 1 nAVAX. This nearly 96% reduction in transaction fees is expected to make Avalanche transactions more affordable, particularly during periods of low network activity. The base fee, a dynamic component of transaction fees, adjusts according to demand for block space, thereby influencing transaction costs.
Dynamic Fee Mechanisms and New Validator Management
Another key feature of the Etna upgrade is the introduction of dynamic fee mechanisms to the P-Chain, as outlined in ACP-103. Previously, the P-Chain operated with a fixed fee structure, which did not account for network congestion. The new dynamic fee system aims to lower transaction costs by adjusting fees based on network load, thus enhancing the chain’s ability to handle increased usage.
ACP-77 is also a notable component of the upgrade, introducing five new P-Chain transaction types for Layer 1 (L1) validator management. This proposal allows for the creation and operation of sovereign L1 blockchains with cost-efficient validation. L1 validators will pay a dynamic continuous fee, initially set at approximately 1.3 AVAX per month, rather than staking a fixed amount of AVAX. This change significantly reduces the economic barriers to creating and operating a blockchain.
Standardizing Interchain Message Signatures
The upgrade includes ACP-118, which proposes a VM-agnostic standard payload format for requesting signatures for Avalanche Interchain Messages (ICM). This standardization simplifies the process of obtaining valid ICM signatures, which are crucial for securing validator management transactions introduced by ACP-77. By integrating this functionality into the AvalancheGo client, the upgrade reduces the complexity of implementing signature aggregators.
Node operators on the Mainnet are required to upgrade their software to AvalancheGo version 1.12.0 or later to ensure compatibility with the Etna upgrade. The plugin version remains unchanged at 38, maintaining compatibility with version 1.11.13. For more details on the upgrade, visit the official announcement here.
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