Nomadic Labs, Trilitech, and Functori are pleased to reveal the name of our upcoming Tezos protocol proposal: “Ushuaia.”
The stabilization phase for the Ushuaia protocol proposal started on March 19th. This post offers a preview of what’s included.
Ushuaia builds on the foundations of recent upgrades, taking significant steps forward on security, scalability and, staking flexibility. It brings meaningful improvements across the protocol stack — from cryptographic future-proofing to a major Data Availability Layer expansion — while laying the groundwork for features to potentially activate in Protocol V.
Highlights:
- DAL bandwidth increase to 10 MB/s: A 15× increase in Data Availability Layer bandwidth, unlocking the next generation of high-volume Tezos applications and rollups.
- Dynamic DAL attestation lag: Attestation lag becomes dynamic, reducing DAL data confirmation from ~66 seconds to an expected 12–18 seconds when network conditions allow.
- WASM PVM: Ushuaia includes protocol-side groundwork required to prepare Etherlink’s storage migration to a faster backend.
- Enshrined liquid staking: A trustless, protocol-native, liquid staking mechanism (sTEZ) is introduced under a feature flag, to be refined with the community ahead of potential mainnet activation in Protocol V.
- Quantum-resistant user keys: A new ML-DSA-44 post-quantum signature scheme (tz5 accounts) is introduced behind a feature flag, representing an early first step towards quantum readiness.
DAL bandwidth increase to 10 MB/s
The Data Availability Layer is upgraded from ~0.66 MB/s to 10 MB/s — a 15x increase — through a combination of software-level optimizations (batched and parallelized shard verification) and updated protocol parameters.
Go to this post to know more
Security guarantees remain unchanged: the same attestation thresholds, baker reward structures, and redundancy factor apply. For most bakers (under ~2% of stake), existing hardware remains sufficient. Larger bakers are encouraged to review the updated hardware recommendations in the linked post.
Why it matters:
- Unlocks higher L2 throughput: Data publication at this scale supports hundreds of thousands of transactions per second on Etherlink and Tezlink, removing bandwidth as a bottleneck.
- Enables more data-intensive dApps: Tezos becomes a more attractive destination for games, high-frequency DeFi, and other demanding on-chain systems.
- Strengthens Tezos’ position: A fully decentralized, protocol-native 10 MB/s data availability solution is a meaningful differentiator in the broader market.
Dynamic DAL attestation lag
The DAL currently operates with a fixed attestation lag - a mandatory delay before new data can be confirmed available on Layer 1. In practice, data propagation often happens faster than the fixed window assumes, adding unnecessary latency to features that depend on it, such as fast withdrawals on Etherlink.
Go to this post to know more.
With Ushuaia, the attestation lag becomes dynamic: each baker publishes their attestation as soon as they observe the data on the DAL network, and the data is marked available once 66% of attesting power has confirmed it, regardless of elapsed time. This reduces the expected attestation lag from 11 blocks (66 seconds) to 2–3 blocks (12–18 seconds) under normal network conditions. Security and reward distribution rules remain unchanged.
Why it matters:
- Faster bridging and withdrawals: Reduced lag directly improves UX for DeFi, payments, and any application relying on fast asset movement between L1 and L2.
- Network-responsive behavior: DAL attestation now aligns with actual conditions rather than initial conservative parameters.
- No impact on regular rollup transactions: The change only affects features that rely on L1 confirmation of DAL data.
WASM PVM: paving the way for a faster durable storage
In the long-term, we plan to migrate Etherlink’s durable storage backend from Irmin to a new, faster backend—a foundational change that will improve the rollups throughput significantly. The migration process must run inside Etherlink’s PVM itself in order to remain deterministic and verifiable in refutation games. During the migration, a rollup kernel needs simultaneous access to both the old and new storage backends, which requires a dual-storage architecture at the PVM level.
Ushuaia delivers the necessary groundwork at the protocol level for this migration. In particular, it introduces a new WASM PVM version (V6), which rollups will adopt if Ushuaia is accepted via the governance mechanism and activates on Tezos L1 mainnet.
V6 extends the business logic of V5, the WASM PVM version currently live on mainnet, to accommodate the dual-backend architecture.
Why it matters:
- Faster rollup execution: migrating away to the new durable storage directly improves Etherlink’s throughput.
- Foundation for RISC-V: migrating to the new durable storage is a prerequisite for the subsequent WASM-to-RISC-V PVM morphing.
(A subsequent protocol proposal will morph the WASM PVM into a RISC-V one. The storage migration will be handled entirely within the Etherlink kernel.)
Enshrined liquid staking (testnet only, for community review & feedback)
The Tezos protocol currently offers only direct staking (illiquid, but trustless), while third-parties offer liquid staking (liquid, but introduces centralization and custodial risks). Ushuaia introduces a third option: enshrined liquid staking — a protocol-native mechanism that enables trustless liquid staking.
Go to this post to know more.
Users deposit XTZ into a protocol-recognized smart contract and receive sTEZ, an FA2.1 token whose value accrues relative to XTZ as staking rewards accumulate. The system is fully trustless — no admin key, no privileged operator — and stake is distributed automatically and fairly across participating bakers. Like the quantum-resistance feature, enshrined liquid staking is included under a feature flag in protocol proposal Ushuaia, available on testnet for community review and refinement, with potential Mainnet activation targeted for Protocol V.
Why it matters:
- In-protocol optionality: Stakers who want liquidity no longer have to rely on centralized intermediaries.
- Governance neutral: Liquid stake carries no voting power in on-chain governance, preserving the integrity of the amendment process.
- DeFi-ready: sTEZ uses a simple accrual model, making it straightforward to integrate into DeFi applications, DEXs, and rollups via protocol-native tickets.
Quantum-resistant user keys (testnet only, for community review & feedback)
Advances in quantum computing pose a long-term risk to the cryptographic foundations of public blockchains. Early preparation carries few downsides, and acting late could have severe consequences for users who fail to migrate before a cryptographic break.
Go to this post to know more.
With Ushuaia, Nomadic Labs, Trilitech, and Functori take a first concrete step by integrating ML-DSA-44, a post-quantum signature scheme standardized by NIST under FIPS 204. New tz5 accounts using this scheme are deployed in production behind a feature flag - giving wallets, custodians, and tool providers time to adapt without requiring any immediate action from users. User operations are fully supported; baking support will follow in a future proposal.
Why it matters:
- Future-proof security: The ecosystem can begin preparing for a post-quantum world before any urgency arises.
- Gradual migration: No disruption to existing accounts or signing schemes, which remain fully supported.
- Foundation for key rotation: This work lays the groundwork for stateful addresses enabling key rotation and advanced account abstraction in a future proposal.
What’s next
As part of the stabilization process, a first nextnet test network for Ushuaia has been launched.
We encourage developers, bakers, and ecosystem teams to start testing their applications and tools against the new protocol proposal on this public testnet.
We plan to release Ushuaia after the successful conclusion of the stabilization period, which is expected to last at least 1 month.
As always, please share any testing results or findings so that the teams at Nomadic Labs, Trilitech, and Functori can promptly address them ahead of the release of the protocol proposal.
