Author: Cookie
Since late April, the Uniswap v4 hook concept has undoubtedly been the most market-watched 'new' concept.
The reason 'new' is put in quotes is not because Uniswap v4 hook is a brand new thing. In fact, Uniswap v4 launched as early as January 30th last year.
The new hook feature is not being ignored or unused. In terms of official support, there are both the Uniswap Hook Incubator and Uniswap Hook Designer Lab, providing funding, training, and incubation. In terms of adoption, there are projects like Flaunch and Bunni, and the overall TVL and trading volume data for the v4 ecosystem is not bad.
But it wasn't until the recent emergence of projects like $upeg, $sato, and Slonks that hooks sparked widespread discussion among the retail investor community. Based on this phenomenon, I will start with a 'bold statement'—
For a long time, Uniswap's promotion of hooks, at least regarding attracting retail investor attention, has been off-target.
And if this deviation is corrected, 'Hook' has the potential to become the sector that opens the bull market.
What Exactly Is 'Hook'?
Let's explain this in an easy-to-understand way, which will also answer another question—why did 'Hook' only attract retail attention now?
In the past, our general understanding of Uniswap was that we could provide LP (liquidity) and trade (Swap) on it. And indeed, before version v4 (before hooks were introduced), these were Uniswap's main profit points.
Many games support player communities in creating 'mods' or 'plugins' to change the game's mode, attracting a broader player base beyond the original modes offered by the developers. For example, in CS, without installing mods, players can only play the game mode of planting/defusing the C4. But with mods installed, players can compete in races, jumping contests, play football, basketball, or even camouflage themselves as part of the map waiting for others to discover them.
Hooks are like game mods. They allow Uniswap to move beyond just the game between LPs and traders. But for a long time, these plugins haven't been attractive to retail players. They either ported existing玩法from other chains or addressed pain points for LPs and traders.
It's like installing only quality-of-life plugins in CS, such as kill statistics. That does make it better, but it lacks the imagination to attract retail players.
What retail players want are new, original, and imaginative玩法that Uniswap doesn't offer officially but can be realized through hooks. The hook concept itself has been too abstract for retail players in the past.
So how is this 'imagination' embodied in the three trending projects, $upeg, $sato, and Slonks?
The Core of 'Imagination'
The core imagination of $upeg is 'Trading as Artistic Creation and Creating Supply Confusion'. First, its image creation concept is complete. It uses on-chain data as creative input rather than simply copying the artistic inspiration of existing NFT series, turning every integer purchase into a new creation. Second, more small, fragmented transactions make it harder to generate images. This makes it not just a simple transformation between image and token forms, nor solely 'to give images better liquidity by existing as tokens'. Instead, it shifts everyone's focus to a 'prediction of supply form'.
If $upeg exists on DEXs, CEXs, and NFT marketplaces, being both a token and an image, what impact will different liquidity sources and trading methods (spot, futures, LP, or buying pictures) have on its supply form?
This is a shift in attention perspective that previous image-token projects over the years never achieved.
Now look at $sato. Its core imagination is not 'using Uniswap v4 hook to make a bonding curve'. Instead, it precisely grasps why making a bonding curve on the Ethereum mainnet can attract people.
The points it gets right are:
Decentralization. This isn't another 'platform'; it's just a contract bound by code.
Massive internal market. Graduation requires a market cap of $100 million. Doing this on any chain other than Ethereum mainnet would seem like a fantasy. But not on Ethereum mainnet because the perception of this chain is 'old money' and 'diamond hands'. This perception deepens as the curve progresses.
Zero intervention. Upon curve completion and token graduation, the contract self-destructs. Subsequent actions like forming pools are left to the community.
Bonding curves aren't new, but $sato presents the one most fitting for Ethereum mainnet's characteristics, shifting players' attention from the bonding curve to a 'game of belief'.
As for Slonks, although much positive sentiment comes from aspects like 'combining AI concept' or 'developer being co-founder of ETHS', I believe its core appeal to retail players is 'providing a meme-worthy博弈mechanism'.
Slonks' images are generated by redrawing CryptoPunks using an on-chain neural network model. Since AI is drawing them, there will be deviations. The dev believes the chaos reflected in these deviations is art. The more it deviates from the original, the higher the 'slop (low quality) value'.
This value ranges from 0 to 576 because CryptoPunks are 24x24 pixels, with each pixel deviation representing one slop value. Since there are 10,000 Slonks NFTs, the theoretical maximum total slop value is 576 * 10,000 = 5,760,000, which is also the maximum supply of $SLOP.
Holders can either burn an NFT to receive corresponding $SLOP based on the NFT's slop value, merge two Slonks NFTs to get one even less similar Slonks NFT to redeem more $SLOP, or burn $SLOP to get back an AI-redrawn NFT with an unknown slop value.
Essentially, it's a '博弈game of comparing whose strategy and luck are better'.
Why is Hook Needed?
So the question arises. Couldn't $upeg, $sato, or Slonks be implemented without Uniswap v4 hook? Why use the hook layer?
Indeed, even without hooks, they could be implemented as standalone projects. But Uniswap needs these projects to attract the retail investor community, and these projects can develop better by leveraging Uniswap's ecosystem scale and concept.
It's not necessary, but it's a very fitting symbiotic relationship. If $upeg hadn't used hooks from the start, it might not have caught Uniswap team's attention, and this wave of hook narrative hype might not have happened.
As retail investors, although 'Uniswap v4 hook' is a concept easily understood by all, we shouldn't blindly jump on anything with 'hook'. We need to consider more whether a project with the 'hook' concept has fresh and unique玩法and a sufficiently complete narrative. This determines the probability of a 'hook' project receiving Uniswap's attention and support.
Only when players' selection criteria are high enough, Uniswap's determination to use hooks to become the app marketplace on Ethereum is strong enough, and developers' creativity is abundant enough, can we truly say that 'Hook' will become the sector that opens the bull market.
