Benefits of L2TPv3 are as follows:

  • Used IP for transport and doesn't require MPLS.
  • Standard protocols.
  • Support any L2 tunneling over IP.


L2TPv3 provides cross-connect:

  • Static L2TPv3 Sessions
  • Dynamic L2TPv3 Sessions

L2TPv3 also supports:

  • Local Switching - Connecting two PWs on the same devices.
  • Local Switching: Quality of Service - providing QoS for PWs.
  • L2TPv3 Pseudowire Switching - Used for Inter-AS and also connecting two contiguous PWs.
  • L2TPv3 Pseudowire Manager
  • IP Packet Fragmentation - various options dealing with MTU and PWs Path MTU.
  • L2TPv3 Type of Service Marking - deals with the ToS values of tunneled packets. One option is "ToS byte reflection" copy to outside IP header. Another option is to statically define the ToS value for the transport IP packets.
  • Keepalive - reliable hello messages are exchanged.
  • Maximum Transmission Unit Handling - provides a way to configure MTU, where if tunneled and header L2TPv3 is larger than configured MTU, packets are dropped.
  • Distributed switching
  • L2TPv3 L2 fragmentation
  • L2TPv3 control message hashing
  • L2TPv3 control message rate limiting
  • L2TPv3 digest secret graceful switchover
  • Manual clearing of L2TPv3 tunnels
  • L2TPv3 tunnel management
  • Color aware policer on ethernet over L2TPv3
  • Site of origin for BGP VPNs
  • IPSec Mapping to L2TPv3
  • Like-to-Like Pseudowires


  • L2TPv3 has two type of connection establishments:
    • Control Connection setup.
    • Session setup
  • Control Connection established communication between two routers with L2TPv3 pw.
  • Session setup is to established the PWs after the control connection is establish.

Additional Resources

Cisco IOS XR Virtual Private Network Configuration Guide for the Cisco CRS Router Implementing Layer 2 Tunnel Protocol Version 3


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