It's most likely going to be make a new world, they do their best to keep it so your old worlds don't become invalidated/corrupted/destroyed with new updates. Yes a mod exists that will attempt to forcibly update your world, but that's a use at your own risk scenario.

Simple reason being, things change and with how procedural generation works updating to the newest version could cause issues, like when some people who had built in mistlands before the update went live had bases ruined due to the height map changes.

Mistlands for example changed the terrain height maps and land size generation. Old mistlands were tiny fragmented islands and elevation was fairly similar to swamp, new mistlands are way more likely to be larger chunks and has higher elevations.

TLDR: If the game automatically updated to the newest world seed generation you could have bases that are no longer touching the ground, are underground, or are in the ocean because of seed generation changes. Almost all games of this "random generation" function the same, make a new world if you want the best version of the newest content.