I have a theoretical understanding that Solana allows the 'upgrade authority' to make changes in the program for the faster improvements. I would like to know what is the extent of this power? Can the upgrade authority change the logic of a Solana program any time? If yes then how good is a Solana program compared to a Web2 app?
2 Answers
This is correct. An upgrade authority has the capability to upgrade the program at any time. The difference between this and Web2 apps is that the upgrade itself will be public since it is accomplished with on-chain transactions.
That being said, for maximum transparency it's still often considered best practice to open source smart contracts and make the upgrade authority a multi-sig wallet or DAO deploy.
On Solana, smart contracts are stored in executable accounts containing the program binary. Each such account has an upgrade authority. This authority can replace said smart contract at will. As such, it is one of the most important factors to consider when deciding whether to put your money into a Solana program.
The upgrade authority has arbitrary control over the deposited funds. They could, for example, replace a DEX with a program that does nothing but provide a function to withdraw all deposited liquidity to the upgrader's wallet.
The upgrade authority of a contract can be a DAO, a multisig, or just an ordinary keypair.
