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If the new() generic constraint is applied, as in this example, that allows the class or method (the AuthenticationBase<T> class in this case) to call new T(); to construct a new instance of the specified type. There is no other way, short of reflection (this includes using System.Activator, to construct a new object of a generic type. New does not guarantee heap allocation and simply avoiding new does not guarantee stack allocation. New is always used to allocate dynamic memory, which then has to be freed. By doing the first option, that memory will be automagically freed when scope is lost.
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