The UID key (device's unique ID key) is an AES 256-bit hardware key, unique to each iPhone. It is fused into the application processor during manufacturing. It was previously used to encrypt things in the NOR. In later iOS versions, it is used to encrypt the entire file system, so that the flash chips cannot moved to another device and read out there again. On the S5L8960 and later, the SEP has its own UID in its own AES engine, used to encrypt user data keybags. On the S8000 and later, the chip securely generates the UID for the device rather than the UID being externally fused in.
Apple says about this key:
"The UID is unique to each device and is not recorded by Apple or any of its suppliers."
"The UID is not related to any other identifier on the device."
See also: GID Key.