Swirl the Mists

Swirl the Mists is an enchantment that says:

As Swirl the Mists enters the battlefield, choose a color word.

All instances of color words in the text of spells and permanents are changed to the chosen color word.

Assume that a player has cast it earlier, choosing white as the color. Then you cast Ulasht, the Hate Seed, which says:

Ulasht, the Hate Seed enters the battlefield with a +1/+1 counter on it for each other red creature you control and a +1/+1 counter on it for each other green creature you control.

Will it look for red and green creatures you control, or white creatures you control?

Ulasht will have the color words in its text box replaced with "white" when it's a spell on the stack, and also when it becomes a permanent on the battlefield. There isn't a single moment, not even for a brief moment, that the color words are reverted back during the resolution of the spell. They are changed to "white" and remain so all the way, without ever reverting back.

This would seem to give a pretty easy answer to the question: It will look for white creatures you control when it's entering the battlefield?

Well, no. That's the incorrect answer. It will look for red and green creatures, as the original text says.

This is one of the most unintuitive, obscure and quirky aspects of the rules of the game. It's so quirky, in fact, that one could justly argue that it's an outright oversight (albeit probably one that would be difficult to fix without breaking something else.)

The thing is, Ulasht's first ability is an ETB replacement effect, and such replacement effects look "forward in time" to see how the permanent would look like when it's on the battlefield (before it actually happens). There's a specific list of things that are taken into account when looking at this hypothetical future permanent, and it so happens that Swirl's static ability is among some of the things that are not included in the list.

This means that the ETB replacement effect will look at how the permanent would look on the battlefield without Swirl's static effect, as if it didn't exist at all. In other words, the hypothetical future permanent will look unmodified, and thus the replacement effect will look for red and green creatures (even though the actual spell, and the permanent it becomes, at no point reverts back to its original wording.)


Edit (Oct 2017): New rules changes with the Ixalan set have changed this. After this rules change Ulasht will look at creature of the color specified by Swirl the Mists. It will get two +1/+1 counters for each creature of that color.