Aave V3.5 Upgrade Process

This document outlines the technical process for upgrading the Aave V3 protocol from version 3.4 to version 3.5 across various networks.

The upgrade is executed via specialized UpgradePayload contracts deployed on each network. A specific version, UpgradePayloadMainnetCore, handles additional steps required for the Ethereum Mainnet to manage the custom functionalities of GHO and AAVE tokens.

Core Components of the Upgrade

1. New Implementations: New implementations for the Pool, AToken, and VariableDebtToken contracts are deployed. These incorporate the v3.5 features and optimizations.
2. Upgrade Payloads: UpgradePayload (for most networks) and UpgradePayloadMainnetCore (for Ethereum Mainnet) contain the sequenced steps to orchestrate the upgrade.
3. Deployment Scripts: Forge scripts (Deploy.s.sol) are used to deterministically deploy all necessary new implementation contracts and the corresponding upgrade payload contract for each network.

Key Migration and Initialization Steps

The Aave v3.5 upgrade is primarily a logic upgrade. Unlike the v3.4 transition, it does not involve complex data migrations or storage slot cleanups. The core changes, such as improved rounding and accounting, are encapsulated within the new contract implementations. The payload's main responsibility is to switch the implementation pointers for the Pool and the associated tokens for each reserve.

General Upgrade Sequence (via UpgradePayload)

This sequence applies to most networks (Polygon, Optimism, Arbitrum, etc.).

1. Upgrade Pool Implementation: The Pool contract proxy is updated to point to the new v3.5 Pool implementation (POOL_IMPL).
2. Update AToken/VariableDebtToken Implementations: The payload iterates through all reserves listed in the Pool:
   • For each reserve, it calls POOL_CONFIGURATOR.updateAToken to upgrade the reserve's AToken proxy to the new standard ATokenInstance implementation (A_TOKEN_IMPL).
   • It then calls POOL_CONFIGURATOR.updateVariableDebtToken to upgrade the reserve's VariableDebtToken proxy to the new standard VariableDebtTokenInstance implementation (V_TOKEN_IMPL).

Ethereum Mainnet Upgrade Sequence (via UpgradePayloadMainnetCore)

This sequence includes the general steps plus specific handling for the AAVE and GHO tokens, executed by the UpgradePayloadMainnetCore contract.

1. Execute Default Upgrade: The _defaultUpgrade() function is called, performing the steps from the "General Upgrade Sequence" above. This process is configured to skip the aAAVE and vGHO tokens, which require special handling.
2. Upgrade vGHO Implementation: POOL_CONFIGURATOR.updateVariableDebtToken is called for the GHO reserve, setting its implementation to the custom V_TOKEN_GHO_IMPL. This implementation ensures continued compatibility with the GHO discount rate strategy.
3. Upgrade aAAVE Implementation: POOL_CONFIGURATOR.updateAToken is called for the AAVE reserve, setting its implementation to the A_TOKEN_WITH_DELEGATION_IMPL. This preserves the vote delegation functionality unique to the AAVE token.