Sentinel Hub Software Upgrade Proposal – Version 12

## Title
Sentinel Hub Upgrade to v12 - Protocol Modernization and Feature Expansion

## Author
Sentinel Core Development Team

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## Abstract
This proposal aims to upgrade the Sentinel Hub software from version 11 to version 12, introducing significant protocol, module, and dependency upgrades. The upgrade enhances scalability, usability, and interoperability, while streamlining economic and operational mechanisms through the introduction of new modules and pricing models.

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## Motivation
The Sentinel Hub v11 release has served as a stable foundation for decentralized VPN operations and related services. However, evolving new economic requirements necessitate a major upgrade. The proposed v12 upgrade introduces key protocol upgrades, new modules, and refined mechanisms that will improve performance, developer experience, and economic flexibility for providers and users.

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## Key Changes and Enhancements

### 1. Core Protocol and Dependency Upgrades
- Cosmos SDK: Upgraded to v0.47.
- CometBFT: Upgraded to v0.37.
- Cosmos IBC: Upgraded to v7.
- CosmWasm: Upgraded to v0.46.

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### 2. Economic and Subscription Model Overhaul

#### 2.1 Introduction of Lease Module
- Decouples time-based node purchases from the Subscription module.
- The Lease module manages provider-specific node leasing, allowing flexible, time-bound node access.
- The Subscription module now focuses purely on managing subscription plans and renewals, simplifying responsibilities and improving maintainability.

#### 2.2 Node Session Model Improvements
- Node-based sessions no longer require an active subscription.
- Users can create sessions directly using a per-session locking mechanism, enabling pay-per-use models and microtransactions.

#### 2.3 Multiple Concurrent Sessions
- Allows multiple active sessions per (account, node) pair simultaneously, supporting parallel connections and improved scalability for multi-client use cases.

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### 3. Pricing and Oracle Improvements

#### 3.1 USD-Based Node Pricing
- Node pricing now supports USD denomination, improving economic clarity and cross-chain integration.
- Enables real-world pricing consistency and aligns with oracle-based data feeds.

#### 3.2 New Oracle Module
- Introduces a dedicated Oracle module for automated price updates.
- Prices for oracle assets are fetched from Osmosis DEX pools via the IBC Async ICQ module, ensuring reliable and decentralized price data.
- Provides dynamic updates to node and subscription plan pricing based on real-time market data.

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### 4. Automation Enhancements
- Automated Lease Renewal: Leases can auto-renew upon expiration if the account has sufficient balance and met renewal requirments.
- Automated Subscription Renewal: Simplifies recurring user subscriptions with automatic renewals to maintain continuous service.

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### 5. New Provider and Subscription Features

#### 5.1 Private Subscription Plans
- Providers can now define private subscription plans, assignable directly to specific user addresses.
- Enables customized offerings, enterprise partnerships, and exclusive plans.

#### 5.2 Improved Provider Flexibility
- Providers gain greater control over node pricing, lease duration, and private plan management through expanded parameters in the Lease and Subscription modules.

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### 6. Governance and Foundation Account Migration
- Sentinel Foundation account will be migrated to a temporary account during the upgrade.
- Post-upgrade, it will be split into multiple managed accounts for better treasury transparency and operational distribution.
- The genesis vesting schedule will be applied, preserving all prior tokenomics and allocation guarantees.

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### 7. Performance and Consensus Enhancements
- Reduced block time from 5 seconds to 3 seconds, increasing network throughput and responsiveness.
- Optimized transaction handling and block propagation to maintain stability at higher block frequencies.

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## Upgrade Plan

### Upgrade Name
v12_0_0

### Upgrade Height
23997755

### Downtime Expectation
Estimated 15–30 minutes for upgrade processing and verification.

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## Expected Benefits
- Enhanced interoperability with the Cosmos ecosystem and IBC-based projects.
- More flexible and transparent economic models for providers and users.
- Improved automation, reducing management overhead.
- Sustainable token and governance management through foundation account restructuring.
- Increased network throughput and reduced latency.

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## Security and Compatibility
- All migrations will follow audited and validated procedures.
- Backward compatibility for core account and balance data ensured.

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## Conclusion
The Sentinel Hub v12 upgrade represents a major leap toward a more scalable, flexible, and economically sustainable decentralized VPN ecosystem. By modernizing its underlying protocol stack and introducing automation, leasing, and oracle-driven pricing, Sentinel positions itself as a robust infrastructure layer for decentralized bandwidth services and beyond.