The use of React Hooks has enabled the development of a scalable and reliable layer of data handling in an application. The custom `useData` hook centralizes all data-retrieval API calls, data exchanges, type checking, caching, and other such data-based functionality. This abstraction and encapsulation of complexity have improved the maintainability and reusability of components. By using React Query for caching, unnecessary network traffic is reduced, and potential errors are minimized. The `useData` hook has simplified the process of managing data in the application, allowing developers to focus on building a great front-end experience.