According to @deanmlittle, transfer hooks in DeFi protocols can undermine composability, a core feature of EVM-based platforms. Instead of enabling seamless automated actions during transfers, transfer hooks often require explicit implementation of new logic. If a protocol fails to implement the required Y action, it blocks the transfer of X, causing incompatibility with the broader DeFi ecosystem and limiting cross-protocol trading opportunities (source: @deanmlittle, Twitter, May 9, 2025). Traders should be aware that these technical limitations could impact liquidity and interoperability, affecting token price movements and arbitrage strategies.