This command will both update the the default versions to match the configuration file and make sure the nightly versions are updated.
Here is how to decide what default versions to use:
The Sway & forc versions should match what is on the latest toolchain.
The version of the wallet SDK should match the version of the Fuel Wallet extension if it is compatible with the latest toolchain. If the extension is not yet compatible, use the latest release that is compatible.
The version of the Rust SDK should be the latest release that is compatible with the default version of forc.
The version of the TypeScript SDK should be the latest release that is compatible with the default version of forc and the Fuel wallet.
The version of the GraphQL API and Specs books should reflect the version of fuel-core used in the latest testnet. These books currently do not have regular releases.