If you replace them with uppercase letters from the start will cause issue's.

Example: 'TTTA'

on the first replace to 'TTTT'
on the second replace to 'AAAA'

by keeping them lowercase you kind mark those that has already been replaced, then you just need to uppercase it to get it correct

This is clever way of doing it to calculate once off to see if something works, but i am not quite sure if this was the intent of the problem :)