Potato, potatoh. There is an actual key to complete the initial upgrade and the final product of doing same is the digital license.
Though I have no doubt there are probably ways MS does this that don't involve you hand entering a key, I've not used them. All the upgrades I've done have been via the Activation pane, Change product key link, which does prompt you for the good, old-fashioned MS product key. After the process completes, if a Microsoft Account is in use, the digital license will be stored in that account as well as linked to the hardware.