TL;DR The first Hook built by Arrakis is live on Uniswap V4. The Arrakis Pro Hook uses a dynamic fee model to protect Token Issuer LPs from arbitrage-related MEV. As the first whitelisted Hook with dynamic fees, this launch improves the onchain experience for Token Issuer LPs. It also signals a moment of transformation for the AMM landscape. 

Uniswap V4’s launch has been one of the biggest DeFi events of the last few years. UniV4’s hallmark feature is Hooks, which lets builders modify the execution flow for pools. Hooks unlock new use cases and new protocols altogether. With UniV4, the way we define a “DEX” has changed and the onchain liquidity landscape has become fertile ground for creativity and experimentation. 

Arrakis is an early UniV4 builder. As one of the first teams to conduct in-depth research into Hooks, we were pleased to support UniV4’s launch in early 2025. Our belief in the possibilities of customizable pools is born out of years of building on Uniswap; Arrakis was a pioneer in concentrated liquidity on UniV3 and we’ve always been committed to helping builders navigate the most cutting-edge DEX innovations.

Today we can announce that our first Hook supporting Token Issuer LPs is live. The Arrakis Pro Hook will accept liquidity from an Arrakis module and use dynamic fees that respond to market conditions. This design makes Token Issuer LPs more profitable and we believe its launch marks a new chapter for the onchain liquidity space.  

Under the Hood: Dynamic Fees, Pool Price Updates, and Privacy 

The Arrakis Pro Hook is one of the first UniV4 deployments to implement dynamic fees. While it’s a new design, it shares some similarities with other dynamic fee AMMs such as TraderJoe and Curve v2. 

With the `beforeSwap` logic, the Hook allows customizable swap fees based on a variety of parameters. The key values for determining the fees are as follows: 

• Market volatility (fees increase during more volatile periods)

• The pool’s inventory balance (fees decrease when the inventory is more imbalanced)

Putting a price on volatility disincentivizes arbitrage attacks because the cost of arbing the pool increases as the price deviates from the CEX price. Fees increase with volatility, so arbitrage attacks become unprofitable and the pool’s prices stay in closer parity with CEX prices. 

The Hook also decreases fees when the pool’s inventory is imbalanced. By incentivizing trading in one direction with lower fees, the pool can replenish the inventory to bring the ratio closer to 50:50. 

The fees will automatically adjust based on real-time data related to the key parameters. This will ensure that Token Issuer LPs can be more profitable and swappers can enjoy a high-frequency, CEX-like experience based on current market conditions. 

The Hook also enables updates to the pool price. This is particularly useful for deployments on cheaper L2s and for assets or pairs that have strong offchain price discovery or price discovery in another pool. In addition to using dynamic fees, Arrakis Pro can also update pricing frequently to improve the swapping experience. 

Additionally, the Hook has a privacy feature that’s optimized for TGEs. The Hook is private in the sense that only one LP (usually the Token Issuer or a whale liquidity provider) can enter the pool. This is useful for TGEs where large LPs can experience extreme losses if they attempt to deposit liquidity into a pool that has already been initialized at an incorrect price. With Arrakis Pro on UniV4, teams can deploy with peace of mind knowing that they have full control over the pricing in this pool. 

Who Could Benefit From Using the Arrakis Pro Hook?

The Arrakis Pro Hook is particularly beneficial for: 

• Token Issuers looking to optimize PnL and inventory management 

• Token Issuers wanting to provide CEX-like pricing onchain for their token 

• Token Issuers wanting a smooth onchain launch during their TGE 

• Stablecoin Issuers (FX) wanting to create deep liquidity that tracks offchain pricing 

Dynamic Fees and the AMM Landscape 

Dynamic fees could drastically change the AMM landscape, helping pools rival CLOBs in performance and efficiency. As one of the earliest Hooks to implement dynamic fees, the Arrakis Pro Hook is spearheading this new era. 

Our Hook is also the first whitelisted dynamic fee Hook. This means it will receive order flow from the Uniswap router, ensuring Token Issuer LPs receive order flow from the Uniswap frontend. We’re pleased to be recognized as an early leader in the Hooks design space alongside other promising solutions. 

We look forward to seeing the pool grow as more and more Token Issuer LPs seek out a more efficient onchain experience. To reach out about onboarding, fill out our contact form here.