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Upstream has added a new environment variable argument to allow systemd to run in initramfs mode with a squash image as the rootfs.

And upstream Dracut squash module has been refactored to use this new argument, this helps to speed up initramfs building and simplify the structure.

This mostly benefits kdump for a better kdump image build speed and reduces memory usage.

Upstream PR for systemd need to be backported:
https://github.com/systemd/systemd/pull/18124

Without this update, the image built with new Dracut squash module cannot boot and kdump will fail.

After backport this update, the image built with new Dracut squash module will work properly.

fix merged to github master branch -> https://github.com/redhat-plumbers/systemd-rhel8/pull/183

Since the problem described in this bug report should be
resolved in a recent advisory, it has been closed with a
resolution of ERRATA.

For information on the advisory (systemd bug fix and enhancement update), and where to find the updated
files, follow the link below.

If the solution does not work for you, open a new bug report.

https://access.redhat.com/errata/RHBA-2021:4469