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VXLAN defines a MAC-in-UDP encapsulation scheme where the original Layer 2 frame has a VXLAN header added and is then placed in a UDP-IP packet. With this MAC-in-UDP encapsulation, VXLAN tunnels Layer 2 network over Layer 3 network.
1 256 Port-channels were supported prior to Cisco NX-OS Software release 5.2(1). 2  A Port-Channel interface number can be configured to use numbers 1 - 4096 per VDC. 3  The Cisco IOS Software uses numbers 1-256 per chassis. 4  LaCP and Static Mode Port-Channels are supported (PaGP is not supported in Cisco NX-OS Software).