VMware vSAN 7 (vSphere 7) can be upgraded in-place to vSAN 8 (vSphere 8) with the original storage architecture (OSA). You cannot upgrade in-place from vSAN 7 to vSAN 8 Express Storage Architecture (ESA). Going from vSAN 7 to vSAN 8 ESA is a migration. In other words, you will need to stand up your new vSAN 8 ESA cluster separately from your existing vSAN 7 cluster and move the data. In most cases, migrating virtual machines can be done without downtime using vMotion and Storage vMotion.
This might seem cumbersome as previous vSAN upgrades could usually be done in-place. It is important to note that most older hardware is not compatible with vSAN 8 ESA. This new hyperconverged infrastructure (HCI) architecture is designed to take full advantage of the capabilities available with the latest NVMe storage devices. Another way to think about this is in terms of traditional storage arrays. Typically when you perform a storage array hardware refresh, you must migrate your data from the old array to the new one. A move from vSAN 7 on older hardware to vSAN 8 ESA on new hardware is no different.
As mentioned above, you can upgrade in-place from vSAN 7 to vSAN 8 as long as you stay with the original storage architecture--vSAN disk groups with a dedicated cache device separate from the capacity devices. See the vSAN 8 documentation for guidance on performing this upgrade. There are two vSAN Compatibility Guides--one for vSAN OSA and one for vSAN ESA. As always, we recommend vSAN ReadyNodes when deploying any version of vSAN. Note that vSAN ReadyNodes are the only supported hardware platforms for vSAN ESA.
For more information on migrating to the ESA, see Migrating to the Express Storage Architecture in vSAN 8.
More information on the features and benefits of vSAN 8 can be found here.