diff --git a/CHANGELOG.md b/CHANGELOG.md
index c4238629..75b23fe7 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -4,6 +4,27 @@ This document outlines major changes between releases.
 
 ## [Unreleased]
 
+New features:
+
+Behaviour changes:
+
+Improvements:
+
+Bugs fixed:
+
+## [0.4.0] (17 July 2025)
+
+This release contains two major changes. First one introduces an ability to
+change block generation time every block. This change is triggered by the
+transfer of `TimePerBlock` setting to native Policy contract on N3 protocol
+which makes this value variable throughout the network lifetime. The second
+change allows to vary block generation time from `TimePerBlock` (when there are
+some transactions in the network and hence, it's beneficial to accept block as
+soon as possible) to `MaxTimePerBlock` (when there are no transactions, but
+consensus still needs to take care of the network heartbeat). This change is
+beneficial for custom networks with small `TimePerBlock` values to prevent the
+chain size explosion. Also, this release contains Go version upgrade to 1.23.
+
 New features:
  * `MaxTimePerBlock` and `SubscribeForTxs` configuration parameters are added
    to support dynamic block time extension (#150)
@@ -14,8 +35,6 @@ Behaviour changes:
 Improvements:
  * minimum required Go version is 1.23 now (#145)
 
-Bugs fixed:
-
 ## [0.3.2] (30 January 2025)
 
 Important dBFT timer adjustments are included into this patch-release. The first one
@@ -119,6 +138,7 @@ Improvements:
 Stable dbft 2.0 implementation.
 
 [Unreleased]: https://github.com/nspcc-dev/dbft/compare/v0.3.2...master
+[0.4.0]: https://github.com/nspcc-dev/dbft/releases/v0.4.0
 [0.3.2]: https://github.com/nspcc-dev/dbft/releases/v0.3.2
 [0.3.1]: https://github.com/nspcc-dev/dbft/releases/v0.3.1
 [0.3.0]: https://github.com/nspcc-dev/dbft/releases/v0.3.0
diff --git a/README.md b/README.md
index f694ae93..95d5491a 100644
--- a/README.md
+++ b/README.md
@@ -38,11 +38,15 @@ for more details.
 
 ## Usage
 A client of the library must implement its own event loop.
-The library provides 5 callbacks that change the state of the consensus
+The library provides 6 callbacks that change the state of the consensus
 process:
 - `Start()` which initializes internal dBFT structures
 - `Reset()` which reinitializes the consensus process
-- `OnTransaction()` which must be called everytime new transaction appears
+- `OnTransaction()` which must be called everytime new transaction from the list
+  of proposed transactions appears
+- `OnNewTransaction()` which is an extension supplying dynamic block time
+  functionality and must be called everytime new transaction comes to the node's
+  memory pool if dynamic block time extension is enabled
 - `OnReceive()` which must be called everytime new payload is received
 - `OnTimer()` which must be called everytime timer fires
 
diff --git a/dbft.go b/dbft.go
index a3936d20..26639e5a 100644
--- a/dbft.go
+++ b/dbft.go
@@ -159,7 +159,8 @@ func (d *DBFT[H]) initializeConsensus(view byte, ts uint64) {
 	d.changeTimer(timeout)
 }
 
-// OnTransaction notifies service about receiving new transaction.
+// OnTransaction notifies service about receiving new transaction from the
+// proposed list of transactions.
 func (d *DBFT[H]) OnTransaction(tx Transaction[H]) {
 	// d.Logger.Debug("OnTransaction",
 	// 	zap.Bool("backup", d.IsBackup()),