Recently, the leading DeFi protocol in the Scroll ecosystem, Pencils Protocol, has welcomed a series of significant market developments. Starting from September 18, the $DAPP token has successively launched IDOs on platforms such as Tonkensoft, Bounce, and Coresky, selling out in a short period. After the token sale was completed, the DAPP token was also listed on Gate, Bybit, and other platforms on September 27, along with the launch of activities including Trade to earn and Staking series, signaling the comprehensive activation of the ecological economic system.
The user enthusiasm for the new market of $DAPP has been immense, and we also have certain growth expectations for it in the secondary market, giving us reason to be optimistic about its long-term prospects.
- Leading protocol in the Scroll ecosystem, attracting users and funds
Pencils Protocol is the leading DeFi protocol in the Scroll ecosystem, with its TVL already surpassing $350 million, accounting for about half of Scroll's TVL. Even from an industry perspective, Pencils Protocol, being single-chain and only having opened the Farming section among many products, can easily exceed $350 million, making it a solid DeFi unicorn project.
Thus, it is not only capturing top resources, funds, and users within the Scroll ecosystem, but with the development of its multi-chain trend and business expansion, the TVL data of Pencils Protocol will continue to break through and maintain its position among the top tier.
Therefore, just from the valuation of Pencils Protocol, it is expected to maintain a position similar to leading DeFi projects like Uniswap and AAVE, and the valuation of $DAPP should be aligned with top assets like UNI and AAVE. Currently, with $DAPP just launched on CEX and trading just opened, there is significant room for value appreciation.
- Strong profitability
Pencils Protocol itself possesses strong profitability. For instance, the already launched Farming and Vaults products have robust revenue-generating scenarios, such as user participation in staking, transaction fees when using Vaults products, and lending income, all of which can generate profits. Especially, the collaboration between Vaults products and Mind Network can capture income from AI, FHE, and other networks.
Upcoming features like auctions and Shop will further help Pencils Protocol establish deep connections with more projects, ecosystems, and sectors, serving as an engine for capturing ecological value.
Thus, the multiple revenue channels brought by various product segments, combined with the current backing of over 550,000 active users and $350 million TVL, will generate substantial trading volume on the Pencils Protocol platform and yield considerable ongoing platform revenue. The platform will use part of its revenue to buy back and burn $DAPP tokens, which will bring strong upward momentum to the token, forming an important value foundation for the continuous appreciation of the DAPP token.
- Multiple application scenarios
The $DAPP token is an important ecological token on the Pencils Protocol platform. Holding DAPP tokens will grant a series of rights, such as enhanced returns from the Vaults section, early allocation in the auction section, and airdrops of future high-quality assets. Additionally, the DAPP token is also an important circulating asset within the ecosystem, such as payment assets in the LaunchPad section and purchases of some RWA assets in the Shop function.
It is foreseeable that, as a result of the series of application scenarios, the DAPP token will continue to maintain its essential demand within the Pencils Protocol ecosystem.
- Low circulating supply
The DAPP token itself has a low circulating supply. For instance, whether in the IDO round or the airdrop round, it is not fully released; instead, a small portion is released initially, with the remainder being released linearly over the following months to a year. Meanwhile, both within the platform and on CEX or among some DeFi partners, a series of staking scenarios have been established for the DAPP token, such as the upcoming Farming of DAPP tokens on the platform and Staking launched on Gate and Bybit, which will further restrict the circulation of DAPP tokens. With the introduction of Vaults and the auction feature next month, the DAPP token will further establish its essential demand and will be continuously burned, meaning that the DAPP token will always maintain a relatively low circulation.
Under the premise of low circulation, the launch of more trading platforms will further drive the value of the DAPP token upward.
Overall, whether from the fundamental aspects of the Pencils Protocol project, the project's profitability, or the DAPP token model and its deflationary and market circulation fundamentals, it possesses strong upward momentum and is worth holding long-term.