Author: Cookie

Since the end of April, the concept of Uniswap v4 hooks has undoubtedly captured the most attention in the market as a "new" concept.

The reason "new" is in quotes is not to suggest that Uniswap v4 hooks are a brand new thing. In fact, Uniswap v4 was launched as early as January 30 of last year.

This new feature, hooks, is not overlooked, nor is it unused. On the support front, there are both the Uniswap Hook Incubator and the Uniswap Hook Designer Lab, providing funding, training, and incubation. On the adoption front, there are projects like Flaunch and Bunni, and the overall TVL and trading volume data of the v4 ecosystem are also impressive.

However, it was not until the recent emergence of projects like $upeg, $sato, and Slonks that hooks started to gain widespread discussion among retail investors. Based on this phenomenon, I would like to present a "bold opinion" at the outset—

For a long time, Uniswap’s promotion of hooks, at least in terms of attention from retail investors, has deviated.

If this deviation is corrected, "Hooks" is expected to become the pathway to initiate a bull market.

What exactly is a "Hook"?

Let’s explain this question in a straightforward way, while also arriving at another answer—why did "Hooks" only capture the attention of retail investors now?

In the past, our general understanding of Uniswap was that we could provide LPs and trade (Swap) on it. This was indeed the main profit point for Uniswap before the introduction of the v4 version (where hooks were incorporated).

Many games support player communities to create "plugins" to change the game format, attracting a wider player base beyond the official modes. For example, in CS, if players do not install plugins, they can only play the C4 installation/defusal confrontations. But if they install plugins, they can race, jump further, play soccer, basketball, and even disguise themselves within the map for others to discover.

Hooks are akin to game plugins; they allow Uniswap to evolve beyond simple interactions between LPs and trades. However, for a long time, these plugins did not attract retail players. They either brought over gameplay already existing on other chains or resolved pain points between LPs and trades.

This is similar to adding some plugins that optimize the gaming experience in CS, like kill statistics. This does improve the game, but lacks the imaginative appeal to attract retail players.

What retail players want are innovative and imaginative new playstyles that can be realized through Hooks, which the Uniswap officials do not provide. The concept of Hooks itself has been far too abstract for retail players in the past.

So how does this "imagination" manifest in the three popular projects $upeg, $sato, and Slonks?

The Core of "Imagination"

The core of $upeg's imagination is "trading is both artistic creation and manufacturing chaotic supply forms." Firstly, its image creation concept is complete, using on-chain data as input for creation instead of simply copying existing NFT series’ artistic inspiration, allowing every integer purchase to become a new creation. Secondly, the more scattered small transactions there are, the harder it becomes to generate images, making it not just a simple conversion between image tokens or merely ensuring liquidity via tokenized images, but shifting the focus towards "predicting supply forms."

If $upeg exists in both DEX, CEX, and NFT markets, being both a coin and an image, how will different sources of liquidity and trading methods (spot, contracts, LP, or image purchases) impact its supply forms?

This is a perspective shift that previous image token projects have never achieved.

Now let’s look at $sato. Its core of imagination is not "creating a bonding curve using Uniswap v4 hooks," but rather precisely grasping what would attract people when doing a bonding curve on the ETH mainnet.

The points it has right are:

Decentralization. This is not another "platform," but a contract strictly defined by code.

Massive internal market. A market cap of $100 million is needed to graduate; doing this on any chain other than the ETH mainnet would seem ridiculous. But not on the ETH mainnet because people have the impression of "lots of old money" and "many diamond hands." This impression deepens with the continued advancement of the curve.

No interference. Once the curve is completed and the token graduates, the contract self-abandons. Future pool arrangements or similar tasks are left for the community to handle.

Bonding curves are not a new gameplay, but $sato presented the one that aligns best with ETH mainnet features, redirecting player attention from bonding curves to a "belief game."

As for Slonks, while there are quite a few optimistic comments such as "incorporating AI concepts" and "the developer is a co-founder of ETHS," I believe its core appeal to retail players lies in "providing a sufficiently meme-driven gaming mechanism."

The images from Slonks are redrawn CryptoPunks using on-chain neural network models. Since AI was used for drawing, there will definitely be deviations, and the developers believe that this deviation reflects a form of art. The less alike the drawing is to the original, the higher the "slop (low quality) value."

This value ranges from 0 to 576 because CryptoPunks are 24x24 pixels, and the deviation of each pixel represents a portion of the slop value. With a total of 10,000 Slonks NFTs, the theoretical total maximum slop value is 576*10,000=5,760,000, which is also the supply cap for $SLOP.

Holders can either burn the NFT to obtain the corresponding $SLOP based on the NFT’s slop value or merge two Slonks NFTs to get a less similar Slonks NFT and exchange it for more $SLOP. They can also burn $SLOP to exchange it for an AI-redrawn NFT with an unknown slop value.

Essentially, this is a "game of who has better strategy and luck."

Why Do We Need Hooks?

Now the question arises. Whether it’s $upeg, $sato, or Slonks, could they not be realized without Uniswap v4 hooks? Why insist on using a layer of hooks?

Indeed, even without hooks, they could be realized as independent projects. But Uniswap needs these projects to attract retail players, and these projects can develop better relying on Uniswap’s ecosystem size and concepts.

This is not necessary, but it is indeed a very fitting mutually beneficial relationship. If initially $upeg had not used hooks, it might not have triggered the Uniswap team’s attention, and this wave of hook narrative might not exist.

As retail players, although the concept of "Uniswap v4 hooks" is something everyone can understand, we should not rush in just because we see "hooks." What we need to consider more is whether a project with the "hook" concept offers fresh and unique gameplay and whether the narrative is sufficiently complete, as this determines the likelihood of a "hook" project gaining Uniswap's attention and support.

Only when players’ selection criteria are high enough, Uniswap is determined enough to make itself the application market on Ethereum for hooks, and developers are creative enough can we truly say that "Hooks" will become the pathway to initiate a bull market.

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