Author: Curry, Shenchao TechFlow
Still FOMOing over yesterday's trending on-chain Ethereum project Slonk? Actually, a new narrative has arrived:
V4 Hook.
Over the past two weeks, Uniswap V4's Hook mechanism suddenly became hot. SATO used Hooks to create an on-chain bonding curve, pushing its market cap to $40 million. uPEG, leveraging the viral story of Uniswap's discarded naming drafts, reached over $30 million in two weeks. Slonks embedded an AI model into a smart contract to mimic CryptoPunks, achieving 586 ETH in trading volume within six days of launch.
While these three projects have different gameplay, they all utilize Uniswap's V4 mechanism.
Now the fourth one is here.
The new project is called $UORE, launched just yesterday. What it does can be summarized in one sentence: It packs on-chain mining, token-buying lottery, pixel NFT auto-generation, and deflationary burning mechanisms, all into a single Uniswap V4 trading pool.
Because buying tokens in this pool triggers the contract to simultaneously perform these six actions in the background, the gas fee for one transaction is two to three times that of a normal swap...
Currently on Crypto Twitter, you'll find everyone complaining about this high gas cost.
Regarding the token, according to GMGN data as of the time of writing, $UORE surged to a market cap of $1.2 million within hours of launch, then quickly dropped back to $440k. The pool liquidity is only $64k, but the 24-hour trading volume is $1.2 million, meaning the money in the pool has been turned over nearly twenty times.
However, there are only 741 holders, and the total supply is less than ten thousand tokens.
Currently, the risks appear extremely high. After a brief study, I personally think it's the most mechanically complex project in the V4 Hook ecosystem (this round of new on-chain plays tends to be confusing in terms of mechanics...).
It is simultaneously a token, an NFT collection, a staking mining farm, and a lottery system. Moreover, these four things are not independent; they are welded together.
The Four-in-One Mining Farm
In most NFT projects, the token and the NFT are two separate things, bought and sold independently.
UORE is not. Its NFT is called Oreling, a 32×32 pixel miner character directly embedded into the token. For every full integer UORE you hold in your wallet, you automatically own one corresponding Oreling.
The contract mints it for you when you buy tokens, burns it when you sell tokens, and the Oreling moves with the UORE when you transfer. You cannot buy an Oreling separately, nor can you detach it from UORE.
Each Oreling's traits are determined by the hash of the next block the moment it is minted. This means you don't know what kind of character you'll get when you buy; not even the validator can see the result in advance.
The differences between these characters are not just about appearance.
Each Oreling has a Class (rarity) and a Hash (a random number from 1 to 100). Multiplying these two gives its Mining Power.
The most common Mortal class accounts for 60% with a 1x multiplier; the rarest God class has only a 1% probability with a 5x multiplier. If you're lucky and get a God with Hash 100, your mining power is 500, more than ten times that of an ordinary miner.
So what is mining power used for? Old-school play: staking.
Stake your Oreling into the mining pool, and you start receiving a share of the daily UORE release based on your mining power proportion. According to the official whitepaper, 1000 UORE are released on the first day, decaying by 1% daily thereafter, with a half-life of approximately 69 days. 80% of the release is distributed to stakers, and 20% goes into the Motherlode prize pool.
This decay rate means that within a year, 97% of the total emission will be released. The earlier you enter to mine, the larger the slice you get.
A design worth noting when claiming rewards: a 10% "refining tax" is deducted and redistributed to all stakers who haven't claimed yet. The whitepaper calls this the refined-ore boost.
In plain language, those who claim later receive more of the taxes paid by others. Those in a hurry to claim are subsidizing the patient ones.
Then there's the Motherlode, translated as the "mineral vein jackpot."
Every time you buy ≥ 0.1 ETH worth of UORE through official channels, you automatically get a lottery ticket. The winning probability is tied to the purchase amount: ~1/600 for 0.1 ETH, ~1/200 for 0.5 ETH, and capped at ~1/100 for 1 ETH. Buying more than 1 ETH doesn't increase the probability, preventing whales from spamming.
If you win, the prize pool is split in two: 50% goes directly to the buyer, and 50% is randomly distributed to one staker (weighted by mining power). As of writing, there have only been 4 wins in history, with the largest prize being 6.4 UORE.
Finally, the deflationary flywheel.
A 1% tax on buys is directly burned, and a 1% tax on sells goes into a buyback treasury. When the treasury accumulates 0.1 ETH, anyone can trigger an automatic buyback, and all bought-back UORE are burned. As of writing, 58 buybacks have been executed, cumulatively burning 358 UORE.
Looking at the overall design, it's a small innovation in token-NFT gameplay, an old trick for creating scarcity, yet another Ponzi in economic model design.
The Code is Forked, The Gameplay is Stitched
UORE wasn't written from scratch.
Someone in the community reviewed the source code and found a folder named `reference/unipeg-hook-source/`. The founder, Noah, hasn't hidden it either. He directly stated on Twitter that UORE's contract is forked from uPEG, and it fixed two known issues with uPEG: duplicate NFT generation and flash loan attacks to farm rarity.
Checking out this founder's account, his bio reads "Ethereum dev & BAYC holder." On May 2nd, he posted his first tweet about UORE, saying the project combines the mining concept from Solana's ORE with the V4 Hook architecture of uPEG.
He also proactively @'ed Unicurvefun and Openpeg, asking if they could support Orelings trading after their marketplaces launch.
From this public information, UORE's project lineage is clear:
Solana ORE provided the "on-chain mining + lottery" gameplay template, uPEG provided the V4 Hook code skeleton, and Noah made improvements and assembly on these two foundations.
Forking itself isn't the issue. I think the current problems are:
- Gas. People on CT report that each UORE transaction needs to complete six steps within the Hook, consuming two to three times the gas of a normal swap. Swapping back and forth might leave little profit.
- Time Window. The V4 Hook narrative, affected by uPEG's decline, will have a lower ceiling for subsequent projects. UORE is the fourth project in this wave of Hook hype, and the heat for the first three is already cooling. The attention window for the track waits for no one.
- Complexity. UORE might be the most mechanically intricate of these four projects. For an average user to understand the whole set of rules—Oreling rarity, mining power calculation, staking decay, refining tax, Motherlode probability, buyback trigger conditions—the barrier is high, and the official website is cryptic.
Moreover, the project whitepaper is also interesting:
"Read the contracts and understand the mechanics before deploying capital."
Translated into Chinese, this roughly means "Understand it before you come; don't blame me if you don't."
Combining this with the previous Hook projects, we can see that this wave of on-chain trends features complex mechanism design + immense information asymmetry, having alpha potential, but the shelf life of that alpha is getting shorter and shorter.
SATO gave about a week, uPEG gave a few days, and by the time we get to UORE, the time left for you to understand the rules might be just a few hours...
By the time you understand, the market move might already be over.
