The revival of the ETH mainnet meme coin ecosystem has brought fresh excitement back to the ETH mainnet. When everyone is trading memes, they might not easily notice that over the past week, ETH mainnet NFTs have also rebounded across the board—there have been almost no declines.

Compared with those old blue-chip NFT series that have quietly rebounded, there is a new project that has achieved a combined effort between NFT players and meme coin players. Yesterday, it briefly broke through a $12 million market cap, and it is currently one of the most talked-about new projects on the ETH mainnet.

It is Unipeg($uPEG).

“Picture and coin, one together”—is the comeback back?

uPEG is very easy to evoke memories of the ERC-404 “Pandora’s Box” that was popular 2 years ago. Indeed, both have a total supply of only 10,000 tokens, with each 1 token corresponding to an image. The picture and the coin are symbiotic: sell 1 token, and the corresponding image is destroyed.

But uPEG is definitely not “an old bottle with a new wine.” Compared with ERC-404, which leans more toward an experiment and innovation at the NFTfi / ERC standards layer, the overall narrative logic of the uPEG project is extremely complete.

First, in terms of naming, Unipeg is the original name of Uniswap.

In July 2017, Hayden Adams was unemployed. At the time, he had no clear plans for the future until his friend Karl Floersch introduced him to smart contracts. Meanwhile, Ethereum founder Vitalik Buterin published an article about the possibilities of doing AMM on Ethereum.

So Hayden Adams started developing Unipeg. Later, he officially got to know Vitalik. Vitalik read the Unipeg smart contract on his phone and suggested he apply for funding from the Ethereum Foundation, and rename the project to Uniswap.

Just from the naming alone, the author of uPEG, 0xhadrian.eth, has provided plenty of meme angles. Naming this new project Unipeg has three layers of meaning:

• The content of the pictures is a series of unicorns; Unipeg = Uni (unicorn) + JPEG (picture)
• A tribute to the origin history of Uniswap
• The word “peg” itself also means “to be hooked,” corresponding to the fact that the project generates images directly through custom logic implemented via trading—which is achieved through Uniswap v4 hooks

Compared with ERC-404, Unipeg also genuinely has substance. Even though just looking at the images, people will likely be baffled—why is this one picture worth over $600?

Eternal on-chain art creation

First, the image foundation of uPEG is the same as CryptoPunks: both are 24x24 pixels. And since it uses “unicorn” elements to pay tribute to Uniswap, first impressions may make it seem rough.

But paying tribute to CryptoPunks doesn’t mean that 24x24 pixels are automatically enough. CryptoPunks’ core historical value is that it’s about digital objects—i.e., cryptocurrencies—that can serve as meaningful information carriers on-chain. It’s not just visual images; it also includes ownership, history, holders, and more. This information exists forever on-chain, is fully verifiable, and requires no intermediaries.

uPEG is also a fully on-chain project. By using a custom Uniswap v4 hook, it renders a unique collectible 24×24 pixel image entirely on-chain, with no external storage and no IPFS.

When a $uPEG trade occurs, this custom Uniswap v4 hook generates a hash value. That hash value is the input for the SVG renderer; based on this hash, the renderer generates each feature of the unicorn—body, eyes, horns, hair, wings, tail, colors, and background.

This is the biggest difference from ERC-404. ERC-404 only proves that the image and the coin can exist in a symbiotic mode, whereas with uPEG, every token transaction means new minting and burning. In theory, the image cap for uPEG is 10,000, but in practice it’s difficult for 10,000 holders to each evenly hold exactly 1 $uPEG , so the actual number of existing images is basically always fewer than 10,000.

Also, when a token is sold, the image corresponding to the original token no longer exists—meaning “death.” And if a new 1 $uPEG is bought, a new image is minted—meaning “birth.” No one can retrieve the “dead” images, because the on-chain data such as the timestamp of each on-chain transaction, the corresponding block, the actor, and so on cannot all be the same; every time the new hash value used to generate a new image also cannot be identical.

Although the number of surviving uPEGs will basically remain forever under 10,000, the number of uPEGs that have existed can be infinite—as long as $uPEG trades continue. This is an endless cycle of creation: the creator is the contract code, and it’s also every person participating in the trade.

This is the real reason why NFT players care—uPEG is neither exactly an NFT nor a meme coin to them; it is an on-chain generative art creation that can, in theory, last forever. The wonder of generative art lies in “in a certain random moment, creating a feeling that can never be replicated.” For example, the famous generative art NFT project Ringers by Dmitri Cherniak—its #879—was treated as a holy grail because its appearance resembles a big goose and cannot be replicated, so collectors revered it.

Ringers #879 was sold to the crypto hedge fund Three Arrows Capital for 1800 ETH (about $5.6 million), and also became one of the most expensive Art Blocks works on the market at the time.

Conclusion

After the “space dog” sparked the ETH mainnet rally, this project is the most “old-Ethereum-flavored” independent project. It brings back memories of the good old days—when people captured new gameplay ideas, and won by treating conviction and fun as the core logic of trading.

Of course, uPEG’s rapid rise in the past few days also can’t be separated from OpenSea CMO Adam Hollander’s buying support, as well as direct interaction from Uniswap team member @saintniko.

Additionally, although the developer behind it remains relatively mysterious, the project has not ended. At present, the corresponding secondary-market product Peg2Peg is under development. Because uPEG is not an ERC-721 image, it cannot be traded on OpenSea or other NFT marketplaces right now.

Peg2Peg under development

Also, according to the author’s vision:

“Over time, the distribution of holders will become more and more fragmented. The number of people holding a full 1 $uPEG (owning a unicorn image) may become fewer and fewer, and the number of unicorns that remain available will also continue to decrease.”

If the market sets up a rarity mechanism for the images, then some images that have been selected by the market and chosen to be collected will circulate through Peg2Peg instead of returning to the liquidity pool in the form of tokens. This is a kind of token deflation and value increase achieved by forming cultural and collecting preferences.

This might be the most interesting way to solve the liquidity problem that we’ve been able to see throughout the development of NFTs over the years.

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