One embodiment of the present invention provides a switch. The switch includes a logical channel apparatus and a tunnel apparatus. The logical channel apparatus associates a logical channel identifier of a logical channel with the switch and assigns an Internet Protocol (IP) address as switch identifier of the switch. The logical channel includes a plurality of member switches and the switch is a member switch of the logical channel. The IP address uniquely identifies the switch in the logical channel. The tunnel apparatus establishes a tunnel with a remote switch in the logical channel. An inter-switch packet from the switch is encapsulated in a tunnel header associated with the tunnel.