[RFC] Hook Manager Framework – On-Chain Policy Orchestration for Uniswap v4

Requests for Comment
1
  • Initial Request for Comment. No Governance action required at this time.

Motivation

Uniswap Protocol v4 arrived with a bang—ushering in unprecedented flexibility via hooks, singleton architecture, and flash accounting. It’s a powerful toolkit, opening doors not just for optimized token swaps, but for a universe of on-chain value exchange: complex financial products, Real-World Assets (RWAs), and institutional-grade DeFi.

But with great power comes great complexity.

How do we safely harness v4’s power for sophisticated use cases? How do we implement custom logic—compliance checks, pricing rules, risk controls—without creating a fragmented, unauditable mess of ad-hoc hooks?

This RFC introduces a proposed solution: On-Chain Policy Orchestration Architecture, centered around a new infrastructure layer called the Hook Manager Framework.

:puzzle_piece: The Problem: Raw Power Needs Structure

Imagine building a skyscraper out of LEGO—with no baseplate and no instructions. That’s what raw v4 hook usage feels like when attempting to support RWAs or institutional-grade logic.

While every v4 hook executes atomically (a big leap over off-chain enforcement!), relying solely on ad-hoc, monolithic hook contracts leads to:

  • Fragmentation – Different pools implement similar logic differently.

  • Duplication – Developers continually reinvent the wheel.

  • Security Risk – Larger, multi-purpose hook contracts are harder to audit.

  • Trust Gaps – DAOs and institutions cannot reliably verify or rely on arbitrary hooks deployed permissionlessly.

There’s a need for structure—one that preserves Uniswap’s neutrality while enabling robust pool-specific behavior.

:hammer_and_wrench: The Solution: The Hook Manager Framework

The Hook Manager is a governance-aware orchestration layer attached to Uniswap v4 pools. It coordinates which policy-specific hooks execute, in what order, and under what conditions.

Key Features:

  • Modular Policy Hooks
    Each custom behavior is implemented as a dedicated, single-purpose contract—e.g.,

    • KYC/AML enforcement

    • Dynamic fees

    • MEV protection

    • RWA settlement logic

  • Orchestration Logic
    The Hook Manager attaches at pool creation and manages:

    • Which hooks execute on specific pool operations (before/after swap, mint, burn, etc.)

    • Execution order of hooks

    • Dynamic registration/deregistration (via governance)

  • Standard Interfaces
    Hook contracts conform to a unified spec, making them easier to audit, monitor, and potentially reuse.

  • Controlled Upgrades
    Through a decentralized governance model (proposed: using UNI), policy hooks can be upgraded while pools are paused—no liquidity migration required.

  • Transparency & Observability
    Hooks and managers emit standardized on-chain events for analytics, compliance audits, and real-time monitoring.

Importantly, the Hook Manager does not modify Uniswap v4 core contracts—it builds on top of them, preserving neutrality and permissionlessness.

:white_check_mark: Why This Matters

This isn’t just a better way to manage hooks—it’s a foundational leap forward for Uniswap v4’s real-world adoption, introducing a scalable, modular, governance-aligned framework to extend Uniswap v4’s hook system into a generalized infrastructure for policy-governed liquidity pools.

:locked_with_key: Enhanced Security

  • Modularity enables smaller, auditable hook contracts

  • Bugs are isolated; the blast radius of errors is reduced

:bank: Institutional Readiness

  • Enables auditable KYC/AML enforcement, risk controls, escrow logic, etc.

  • Makes Uniswap pools usable by custodians, banks, and DAOs with specific mandates

:rocket: Developer Efficiency

  • Clear interfaces and modular design reduce complexity, accelerate innovation, and improve testing workflows

:balance_scale: Regulatory Adaptability

  • Need to add a new compliance rule? Deploy a new policy hook without touching other logic

:1st_place_medal: Competitive Agility

  • New features can be rapidly deployed via standalone hooks (e.g., slippage protections, dynamic pricing models)

:balance_scale: Addressing Trade-offs

:fuel_pump: Gas Costs

Yes—each policy hook adds gas. But:

  • For large trades (institutions, RWAs), the cost is trivial compared to the value of guarantees

  • L2 deployments will greatly reduce overhead

  • Selective policy exemption and optimization techniques are possible

:droplet: Liquidity Fragmentation

The framework leads to more pools—but fragmentation already exists across fee tiers, versions, and L2s.

  • Aggregators (e.g., 1inch) and smart routers already solve this

  • For policy-sensitive users, verifiability > slippage
    Fit-for-purpose liquidity is the goal—not maximum depth

:person_shrugging: Why Not Use Frontends or Raw Hooks?

  • Frontend rules are easily bypassed

  • Raw hooks lack auditability, standardization, and trust guarantees

  • The Hook Manager introduces curation, policy discovery, and on-chain enforcement—all composable and transparent

:classical_building: Governance & Ecosystem Design

:ballot_box_with_ballot: Decentralized Governance (Proposed)

  • Governance over Hook Managers and registered hooks scoped via UNI token

  • Tiered voting – technical changes weighted toward developers; UX-impacting changes weighted toward users

  • Roles:

    • Hook Developers – permissionless contract authors

    • Curators – recommend and audit hooks for specific verticals (e.g., RWA, stablecoins, MEV)

:money_bag: Licensing & Monetization

  • Business Source License (BSL) for core components, with a permissive license transition after 1 year

  • Commercial Licensing for enterprise usage (e.g., banks, custodians)

  • Shared Deployment Costs among institutions using the same policy set

  • Rebates/Credits for LPs who help bootstrap policy-enabled pools

This model aligns incentives while supporting open experimentation.

:globe_showing_europe_africa: Vision: Beyond Token Swaps

The Hook Manager Framework helps Uniswap v4 evolve from “flexible DEX” into a universal value exchange substrate.

It provides the structure needed to support:

  • Institutional finance

  • Real-world asset settlement

  • Verticalized DeFi use cases

  • Cross-protocol integrations

  • Composable compliance

All without compromising core Uniswap principles of neutrality, modularity, and permissionless innovation.

:speaking_head: Feedback Requested

We invite community feedback on the following:

  • Is the Hook Manager framework directionally aligned with Uniswap v4’s architecture and goals?

  • Are the trade-offs (e.g., gas, fragmentation) acceptable for the benefits?

  • Does the governance model appropriately balance decentralization and practical execution?

  • Are there any blockers, risks, or implementation pitfalls that deserve more attention?

:paperclip: Resources

Author: Mohamed ElBendary
Status: RFC (Request for Comment)
Date: May 2 2025

2 Likes
2

As a protocol integrating v4 Hooks, fragmentation is a key issue for us. We love what v4 builders do, but are severly bottlenecked in which pools we can integrate due to the overgrowth of custom logic.

Some context: Arcadia is the biggest ALM on Base with $11m TVL, providing management of clAMM pools through self-custodial EOAs. We’re working with L1.co’s biggest asset managers to onboard offchain capital to DeFi.

Currently, most production-ready v4 Hook protocols would require us to do dedicated smart contract work and audits for an integration. It’s basically the same work as integrating a whole new DEX.

A framework to standardize v4 Hooks would drastically increase our capacity to integrate new pools, translating into more exposure for these pools to our users.

3

Hi @mbendary, We wanted to drop a quick comment to thank you for posting this idea. You have identified a valuable problem and suggested a thoughtful solution.

We’ll follow up once we have had a chance to consider the idea more!

4

This is exactly the kind of context that makes the pain point real—thank you for surfacing it.

The framework aims to streamline the discoverability of relevant, trusted hook contracts and reduce the DEX-level integration burden. It does this by enabling composable policy logic, shared coordination layers, and modular governance—without requiring duplicative work across similar-profile pools.

Would welcome any feedback as you explore whether this might help Arcadia scale deeper into v4’s design space.

Thanks again for engaging so constructively—it’s a huge boost to see validation from a team actively operating at the edge of what v4 enables.

1 Like
5

Hi @GFXlabs team, I appreciate you taking the time to acknowledge the proposal and signal interest—thank you.

I’d welcome any feedback once you’ve had a chance to consider it more deeply—especially around how the proposed framework and curation surfaces might align (or not) with the broader governance priorities you’re thinking through. I believe scaling DeFi beyond native crypto depends on solving how v4 hooks are composed, coordinated, and governed.

Happy to go deeper or walk through specific design choices if helpful. Appreciate the thoughtful presence the GFX team brings to the ecosystem.

1 Like
6

Hey Mohamed, thank you so much for this thoughtful proposal addressing hook development structure in v4. We appreciate the clear identification of challenges around standardization, security, and institutional adoption. As we at the Uniswap Foundation have also been considering how to best ensure the success and growth of Uniswap v4, we wanted to provide some feedback to some of your questions at the end of the post.

Is the Hook Manager framework directionally aligned with Uniswap v4’s architecture and goals?

The challenges you’ve identified are important to address. We believe a governance-managed orchestration layer may not fully align with v4’s architectural philosophy of permissionless innovation. Instead, we see these challenges being addressed by a decentralized ecosystem of builders and participants, competing for the best solutions.

We’re actively working on initiatives that address these same challenges through a decentralized approach:

  1. Security: The Uniswap Foundation Security Fund supports teams building with v4 with their hook audits. This program is a part of a grant from the UF to Areta who facilitate an auditor marketplace for hook teams.
  2. Institutional Readiness: While not live yet, we are excited to share a grant around institutional hooks in the coming weeks, alongside a white paper of strong use cases.
  3. Developer Efficiency: The Uniswap Hook Incubator focuses on growing a diverse and decentralized developer ecosystem in a competitive environment. We have seen really strong teams, like Cork and Tenor Finance, emerge from the UHI.
  4. Adaptability: While upgradeability sounds beneficial, we believe immutability is a core strength, not a limitation.

Looking Forward

We’re excited to see forum discussion about v4’s future through your proposal. Thank you again for kickstarting this conversation. We’d welcome further discussion on:

  • Achieving standardization without centralized coordination
  • Specific institutional requirements needing better documentation
  • Supporting developers in creating secure, reusable hooks without constraining innovation