v4-security-foundations

v4 Hook Security Foundations

Security-first guide for building Uniswap v4 hooks. Hook vulnerabilities can drain user funds—understand these concepts before writing any hook code.

Threat Model

Before writing code, understand the v4 security context:

Threat Area	Description	Mitigation
Caller Verification	Only `PoolManager` should invoke hook functions	Verify `msg.sender == address(poolManager)`
Sender Identity	`msg.sender` always equals PoolManager, never the end user	Use `sender` parameter for user identity
Router Context	The `sender` parameter identifies the router, not the user	Implement router allowlisting
State Exposure	Hook state is readable during mid-transaction execution	Avoid storing sensitive data on-chain
Reentrancy Surface	External calls from hooks can enable reentrancy	Use reentrancy guards; minimize external calls

Permission Flags Risk Matrix

All 14 hook permissions with associated risk levels:

Permission Flag	Risk Level	Description	Security Notes
`beforeInitialize`	LOW	Called before pool creation	Validate pool parameters
`afterInitialize`	LOW	Called after pool creation	Safe for state initialization
`beforeAddLiquidity`	MEDIUM	Before LP deposits	Can block legitimate LPs
`afterAddLiquidity`	LOW	After LP deposits	Safe for tracking/rewards
`beforeRemoveLiquidity`	HIGH	Before LP withdrawals	Can trap user funds
`afterRemoveLiquidity`	LOW	After LP withdrawals	Safe for tracking
`beforeSwap`	HIGH	Before swap execution	Can manipulate prices
`afterSwap`	MEDIUM	After swap execution	Can observe final state
`beforeDonate`	LOW	Before donations	Access control only
`afterDonate`	LOW	After donations	Safe for tracking
`beforeSwapReturnDelta`	CRITICAL	Returns custom swap amounts	NoOp attack vector
`afterSwapReturnDelta`	HIGH	Modifies post-swap amounts	Can extract value
`afterAddLiquidityReturnDelta`	HIGH	Modifies LP token amounts	Can shortchange LPs
`afterRemoveLiquidityReturnDelta`	HIGH	Modifies withdrawal amounts	Can steal funds

Risk Thresholds

LOW: Unlikely to cause fund loss
MEDIUM: Requires careful implementation
HIGH: Can cause fund loss if misimplemented
CRITICAL: Can enable complete fund theft

CRITICAL: NoOp Rug Pull Attack

The BEFORE_SWAP_RETURNS_DELTA permission (bit 10) is the most dangerous hook permission. A malicious hook can:

Return a delta claiming it handled the entire swap
PoolManager accepts this and settles the trade
Hook keeps all input tokens without providing output
User loses entire swap amount

Attack Pattern

// MALICIOUS - DO NOT USE
function beforeSwap(
    address,
    PoolKey calldata,
    IPoolManager.

Detection

Before interacting with ANY hook that has beforeSwapReturnDelta: true:

Audit the hook code - Verify legitimate use case
Check ownership - Is it upgradeable? By whom?
Verify track record - Has it been audited by reputable firms?
Start small - Test with minimal amounts first

Legitimate Uses

NoOp patterns are valid for:

Just-in-time liquidity (JIT)
Custom AMM curves
Intent-based trading systems
RFQ/PMM integrations

But each requires careful implementation and audit.

Delta Accounting Fundamentals

v4 uses a credit/debit system through the PoolManager:

Core Invariant

The PoolManager tracks what each address owes or is owed. At transaction end, all debts must be settled.

Key Functions

Function	Purpose	Direction
`take(currency, to, amount)`	Withdraw tokens from PoolManager	You receive tokens
`settle(currency)`	Pay tokens to PoolManager	You send tokens
`sync(currency)`	Update PoolManager balance tracking	Preparation for settle

Settlement Pattern

Common Mistakes

Forgetting sync: Settlement fails without sync
Wrong order: Must sync → transfer → settle
Partial settlement: Leaves transaction in invalid state
Double settlement: Causes accounting errors

Access Control Patterns

PoolManager Verification

Every hook callback MUST verify the caller:

Why This Matters

Without this check:

Anyone can call hook functions directly
Attackers can manipulate hook state
Funds can be drained through fake callbacks

Router Verification Patterns

The sender parameter is the router, not the end user. For hooks that need user identity:

Allowlisting Pattern

User Identity via hookData

msg.sender Trap

Token Handling Hazards

Not all tokens behave like standard ERC-20s:

Token Type	Hazard	Mitigation
Fee-on-transfer	Received amount < sent amount	Measure actual balance changes
Rebasing	Balance changes without transfers	Avoid storing raw balances
ERC-777	Transfer callbacks enable reentrancy	Use reentrancy guards
Pausable	Transfers can be blocked	Handle transfer failures gracefully
Blocklist	Specific addresses blocked	Test with production addresses
Low decimals	Precision loss in calculations	Use appropriate scaling

Safe Balance Check Pattern

Base Hook Template

Start with all permissions disabled. Enable only what you need:

See references/base-hook-template.md for a complete implementation template.

Security Checklist

Before deploying any hook:

#	Check	Status
1	All hook callbacks verify `msg.sender == poolManager`	[ ]
2	Router allowlisting implemented if needed	[ ]
3	No unbounded loops that can cause OOG	[ ]
4	Reentrancy guards on external calls	[ ]
5	Delta accounting sums to zero	[ ]
6	Fee-on-transfer tokens handled	[ ]
7	No hardcoded addresses	[ ]
8	Slippage parameters respected	[ ]
9	No sensitive data stored on-chain	[ ]
10	Upgrade mechanisms secured (if applicable)	[ ]
11	`beforeSwapReturnDelta` justified if enabled	[ ]
12	Fuzz testing completed	[ ]
13	Invariant testing completed	[ ]

Gas Budget Guidelines

Hook callbacks execute inside the PoolManager's transaction context. Excessive gas consumption can make swaps revert or become economically unviable.

Gas Budgets by Callback

Callback	Target Budget	Hard Ceiling	Notes
`beforeSwap`	< 50,000 gas	150,000 gas	Runs on every swap; keep lean
`afterSwap`	< 30,000 gas	100,000 gas	Analytics/tracking only
`beforeAddLiquidity`	< 50,000 gas	200,000 gas	May include access control
`afterAddLiquidity`	< 30,000 gas	100,000 gas	Reward tracking
`beforeRemoveLiquidity`	< 50,000 gas	200,000 gas	Lock validation
`afterRemoveLiquidity`	< 30,000 gas	100,000 gas	Tracking/accounting
Callbacks with external calls	< 100,000 gas	300,000 gas	External DEX routing, oracles

Common Gas Pitfalls

Unbounded loops: Iterating over dynamic arrays (e.g., all active positions) can exceed block gas limits. Cap array sizes or use pagination.
SSTORE in hot paths: Each new storage slot costs ~20,000 gas. Prefer transient storage (tstore/tload) for data that doesn't persist beyond the transaction. Requires Solidity >= 0.8.24 with EVM target set to cancun or later.
External calls: Each cross-contract call adds ~2,600 gas base cost plus the callee's execution. Batch calls where possible.
String operations: Avoid string manipulation in callbacks; use bytes32 for identifiers.
Redundant reads: Cache poolManager calls — repeated getSlot0() or getLiquidity() reads cost gas each time.

Measuring Gas

Risk Scoring System

Calculate your hook's risk score (0-33):

Category	Points	Criteria
Permissions	0-14	Sum of enabled permission risk levels
External Calls	0-5	Number and type of external interactions
State Complexity	0-5	Amount of mutable state
Upgrade Mechanism	0-5	Proxy, admin functions, etc.
Token Handling	0-4	Non-standard token support

Audit Tier Recommendations

Score	Risk Level	Recommendation
0-5	Low	Self-audit + peer review
6-12	Medium	Professional audit recommended
13-20	High	Professional audit required
21-33	Critical	Multiple audits required

Absolute Prohibitions

Never do these things in a hook:

Never trust msg.sender for user identity - It's always PoolManager
Never enable beforeSwapReturnDelta without understanding NoOp attacks
Never store passwords, keys, or PII on-chain
Never use transfer() for ETH - Use call{value:}("")
Never assume token decimals - Always query the token
Never use block.timestamp for randomness
Never hardcode gas limits in calls
Never ignore return values from external calls
Never use tx.origin for authorization - It's a phishing vector; malicious contracts can relay calls with the original user's tx.origin

Pre-Deployment Audit Checklist

#	Item	Required For
1	Code review by security-focused developer	All hooks
2	Unit tests for all callbacks	All hooks
3	Fuzz testing with Foundry	All hooks
4	Invariant testing	Hooks with delta returns
5	Fork testing on mainnet	All hooks
6	Gas profiling	All hooks
7	Formal verification	Critical hooks
8	Slither/Mythril analysis	All hooks
9	External audit	Medium+ risk hooks
10	Bug bounty program	High+ risk hooks
11	Monitoring/alerting setup	All production hooks

See references/audit-checklist.md for detailed audit requirements.

Production Hook References

Learn from audited, production hooks:

Project	Description	Notable Security Features
Flaunch	Token launch platform	Multi-sig admin, timelocks
EulerSwap	Lending integration	Isolated risk per market
Zaha TWAMM	Time-weighted AMM	Gradual execution reduces MEV
Bunni	LP management	Concentrated liquidity guards

External Resources

Official Documentation

Security Resources

Community

v4-hooks-skill by @igoryuzo - Community skill that inspired this guide
v4hooks.dev - Community hook resources

Additional References

Base Hook Template - Complete implementation starter
Vulnerabilities Catalog - Common patterns and mitigations
Audit Checklist - Detailed pre-deployment checklist