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title: Liquidity Hooks | ||
--- | ||
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This guide will walk through on an example of adding and removing liquidity. There are four hook functions available to customize and extend these behavior: | ||
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- `beforeAddLiquidity` | ||
- `afterAddLiquidity` | ||
- `beforeRemoveLiquidity` | ||
- `afterRemoveLiquidity` | ||
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As the names suggest `beforeAddLiquidity`/`afterAddLiquidity` are functions called before or after liquidity is added to a pool. | ||
Similarly `beforeRemoveLiquidity`/`afterRemoveLiquidity` are functions called before or after liquidity is removed from a pool. | ||
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This guide will go through the parameters and examples specifically for `beforeAddLiquidity` and `beforeRemoveLiquidity`. | ||
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Note: The liquidity examples are not production ready code, and are implemented in a simplistic manner for the purpose of learning. | ||
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## Set Up the Contract | ||
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Declare the solidity version used to compile the contract, since transient storage is used the solidity version will be `>=0.8.24`. | ||
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```solidity | ||
// SPDX-License-Identifier: MIT | ||
pragma solidity ^0.8.24; | ||
``` | ||
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Import the relevant dependencies from `v4-core` and `v4-periphery`: | ||
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```solidity | ||
import {BaseHook} from "v4-periphery/src/base/hooks/BaseHook.sol"; | ||
import {Hooks} from "v4-core/src/libraries/Hooks.sol"; | ||
import {IPoolManager} from "v4-core/src/interfaces/IPoolManager.sol"; | ||
import {PoolKey} from "v4-core/src/types/PoolKey.sol"; | ||
import {PoolId, PoolIdLibrary} from "v4-core/src/types/PoolId.sol"; | ||
import {BalanceDelta} from "v4-core/src/types/BalanceDelta.sol"; | ||
import {BeforeSwapDelta, BeforeSwapDeltaLibrary} from "v4-core/src/types/BeforeSwapDelta.sol"; | ||
``` | ||
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Create a contract called LiquidityHook, use `PoolIdLibrary` to attach functions of computing ID of a pool to `PoolKey`. Declare two mappings to act as counters when calling `beforeAddLiquidity` and `beforeRemoveLiquidity`. | ||
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```solidity | ||
contract LiquidityHook is BaseHook { | ||
using PoolIdLibrary for PoolKey; | ||
// NOTE: --------------------------------------------------------- | ||
// state variables should typically be unique to a pool | ||
// a single hook contract should be able to service multiple pools | ||
// --------------------------------------------------------------- | ||
mapping(PoolId => uint256 count) public beforeAddLiquidityCount; | ||
mapping(PoolId => uint256 count) public beforeRemoveLiquidityCount; | ||
constructor(IPoolManager _poolManager) BaseHook(_poolManager) {} | ||
``` | ||
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Override `getHookPermissions` from `BaseHook.sol` to return a struct of permissions to signal which hook functions are to be implemented. | ||
It will also be used at deployment to validate the address correctly represents the expected permissions. | ||
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```solidity | ||
function getHookPermissions() public pure override returns (Hooks.Permissions memory) { | ||
return Hooks.Permissions({ | ||
beforeInitialize: false, | ||
afterInitialize: false, | ||
beforeAddLiquidity: true, | ||
afterAddLiquidity: false, | ||
beforeRemoveLiquidity: true, | ||
afterRemoveLiquidity: false, | ||
beforeSwap: false, | ||
afterSwap: false, | ||
beforeDonate: false, | ||
afterDonate: false, | ||
beforeAddLiquidityReturnDelta: false, | ||
afterSwapReturnDelta: false, | ||
afterAddLiquidityReturnDelta: false, | ||
afterRemoveLiquidityReturnDelta: false | ||
}); | ||
} | ||
``` | ||
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## beforeAddLiquidity | ||
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Here the example shows that every time __before__ liquidity is added to a pool, `beforeAddLiquidityCount` for that pool will be incremented by one. | ||
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```solidity | ||
function beforeAddLiquidity( | ||
address, | ||
PoolKey calldata key, | ||
IPoolManager.ModifyLiquidityParams calldata, | ||
bytes calldata | ||
) external override returns (bytes4) { | ||
beforeAddLiquidityCount[key.toId()]++; | ||
return BaseHook.beforeAddLiquidity.selector; | ||
} | ||
``` | ||
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### `beforeAddLiquidity` Parameters | ||
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When triggering the `beforeAddLiquidity` hook function, there are some parameters we can make use of to customize or extend the behavior of `modifyLiquidity`. These parameters are described in `beforeAddLiquidity` from [`IHooks.sol`](https://github.com/Uniswap/v4-core/blob/main/src/interfaces/IHooks.sol#L47). | ||
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A brief overview of the parameters: | ||
- `sender` The initial `msg.sender` for the add liquidity call | ||
- `key` The key for the pool | ||
- `params` The parameters for adding liquidity i.e. `ModifyLiquidityParams` from [`IPoolManager.sol`](https://github.com/Uniswap/v4-core/blob/main/src/interfaces/IPoolManager.sol#L125C12-L125C33) | ||
- `hookData` Arbitrary data handed into the `PoolManager` by the liquidity provider to be be passed on to the hook | ||
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## beforeRemoveLiquidity | ||
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Similiar as above, every time __before__ liquidity is removed from a pool, `beforeRemoveLiquidityCount` for that pool will be incremented by one. | ||
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```solidity | ||
function beforeRemoveLiquidity( | ||
address, | ||
PoolKey calldata key, | ||
IPoolManager.ModifyLiquidityParams calldata, | ||
bytes calldata | ||
) external override returns (bytes4) { | ||
beforeRemoveLiquidityCount[key.toId()]++; | ||
return BaseHook.beforeRemoveLiquidity.selector; | ||
} | ||
``` | ||
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### `beforeRemoveLiquidity` Parameters | ||
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When triggering the `beforeRemoveLiquidity` hook function, there are some parameters we can make use of to customize or extend the behavior of `modifyLiquidity`. These parameters are described in `beforeRemoveLiquidity` from [`IHooks.sol`](https://github.com/Uniswap/v4-core/blob/main/src/interfaces/IHooks.sol#L78). | ||
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A brief overview of the parameters: | ||
- `sender` The initial msg.sender for the remove liquidity call | ||
- `key` The key for the pool | ||
- `params` The parameters for removing liquidity i.e. `ModifyLiquidityParams` from [`IPoolManager.sol`](https://github.com/Uniswap/v4-core/blob/main/src/interfaces/IPoolManager.sol#L125C12-L125C33) | ||
- `hookData` Arbitrary data handed into the `PoolManager` by the liquidity provider to be be passed on to the hook | ||
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## A Complete Liquidity Hook Contract | ||
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```solidity | ||
// SPDX-License-Identifier: MIT | ||
pragma solidity ^0.8.24; | ||
import {BaseHook} from "v4-periphery/src/base/hooks/BaseHook.sol"; | ||
import {Hooks} from "v4-core/src/libraries/Hooks.sol"; | ||
import {IPoolManager} from "v4-core/src/interfaces/IPoolManager.sol"; | ||
import {PoolKey} from "v4-core/src/types/PoolKey.sol"; | ||
import {PoolId, PoolIdLibrary} from "v4-core/src/types/PoolId.sol"; | ||
import {BalanceDelta} from "v4-core/src/types/BalanceDelta.sol"; | ||
import {BeforeSwapDelta, BeforeSwapDeltaLibrary} from "v4-core/src/types/BeforeSwapDelta.sol"; | ||
contract LiquidityHook is BaseHook { | ||
using PoolIdLibrary for PoolKey; | ||
// NOTE: --------------------------------------------------------- | ||
// state variables should typically be unique to a pool | ||
// a single hook contract should be able to service multiple pools | ||
// --------------------------------------------------------------- | ||
mapping(PoolId => uint256 count) public beforeAddLiquidityCount; | ||
mapping(PoolId => uint256 count) public beforeRemoveLiquidityCount; | ||
constructor(IPoolManager _poolManager) BaseHook(_poolManager) {} | ||
function getHookPermissions() public pure override returns (Hooks.Permissions memory) { | ||
return Hooks.Permissions({ | ||
beforeInitialize: false, | ||
afterInitialize: false, | ||
beforeAddLiquidity: true, | ||
afterAddLiquidity: false, | ||
beforeRemoveLiquidity: true, | ||
afterRemoveLiquidity: false, | ||
beforeSwap: false, | ||
afterSwap: false, | ||
beforeDonate: false, | ||
afterDonate: false, | ||
beforeAddLiquidityReturnDelta: false, | ||
afterSwapReturnDelta: false, | ||
afterAddLiquidityReturnDelta: false, | ||
afterRemoveLiquidityReturnDelta: false | ||
}); | ||
} | ||
// ----------------------------------------------- | ||
// NOTE: see IHooks.sol for function documentation | ||
// ----------------------------------------------- | ||
function beforeAddLiquidity( | ||
address, | ||
PoolKey calldata key, | ||
IPoolManager.ModifyLiquidityParams calldata, | ||
bytes calldata | ||
) external override returns (bytes4) { | ||
beforeAddLiquidityCount[key.toId()]++; | ||
return BaseHook.beforeAddLiquidity.selector; | ||
} | ||
function beforeRemoveLiquidity( | ||
address, | ||
PoolKey calldata key, | ||
IPoolManager.ModifyLiquidityParams calldata, | ||
bytes calldata | ||
) external override returns (bytes4) { | ||
beforeRemoveLiquidityCount[key.toId()]++; | ||
return BaseHook.beforeRemoveLiquidity.selector; | ||
} | ||
} | ||
``` |