As the Pencils Protocol completes the IDO of DAPP on platforms such as Tokensoft, Bounce, and Coresky, and simultaneously launches DAPP on Gate, Bitget, Bybit, and Kucoin for trading, it signifies the full operation of the Pencils Protocol ecosystem economic system.
After the trading of DAPP opens, the token has also launched short-term staking activities on Gate, Bybit, and Pencils Protocol, with staking APY ranging from 50% to 800%. The high APY has attracted a large number of DAPP token holders, including airdrop users and new investors, to actively participate in order to gain higher returns in terms of token value, significantly reducing the early market circulation of DAPP tokens.
With Pencils Protocol continuously promoting a series of market developments, the low circulating supply of DAPP is expected to capture value in the subsequent market and continue into a new round of deflation.
What role does $DAPP play in the Pencils Protocol ecosystem?
$DAPP is an important core asset in the Pencils Protocol ecosystem. Holding DAPP tokens allows access to various functions and privileges, including enhanced staking rewards, higher leverage privileges in the Vaults section, and more allocation opportunities for LaunchPad projects in the Auction section.
Similarly, in the Auction section, $DAPP also serves as collateral for trading NFTs and real-world assets, integrated into DeFi products to achieve liquidity and lending, with users enjoying fee discounts when using Bridge and DEX services.
As a comprehensive yield platform within the Scroll ecosystem, Pencils Protocol offers essential functions, whether it’s the multiple capture of farming points, leveraged mining and asset management in the Vaults section, or the upcoming Auction model. This is especially necessary for whale investors, LRT project parties, as well as AI and FHE projects that need services from Pencils Protocol, indicating that the demand for DAPP is certain and ongoing.
Pencils Protocol has clearly stated that it will regularly conduct buybacks and burns of $DAPP, for example, the Vaults will use 30% of profit revenue to buy back DAPP tokens to accelerate its deflation, and other sections will gradually use profits to buy back DAPP tokens in the future.
Therefore, from a mechanical perspective, DAPP will have essential demand, especially with the burn mechanism continuing to create deflation.
Low circulating supply of DAPP
The total supply of DAPP tokens is 100 million, which is relatively small compared to other tokens with total supplies in the tens of billions of dollars. Looking at the token distribution, almost all sections have a lock-up period; for instance, the public offering round has a lock-up period of 8 to 12 months, and the airdrop round also has a certain lock-up period, releasing 50% at TGE, 25% 30 days after TGE, and the remaining 25% 60 days after TGE.
Currently, the DAPP tokens circulating in the market are only a few million, and at this stage, the launch of a series of staking activities on different platforms has greatly restricted the early circulation of DAPP tokens. Especially with the launch of the Vaults product, the market demand will further reduce the market circulation rate of DAPP tokens.
This means that DAPP tokens are scarce, making them easier to pump in the future! Market sentiment is still driving more people to participate in buying, aiming for long-term positioning.
Buying pressure far exceeds selling pressure; smart people are buying!
Currently, whether on Gate, Bybit, Kucoin, or Bitget, buying pressure far exceeds selling pressure, indicating that many smart people are accumulating tokens, waiting for long-term opportunities rather than short-term sales.
This indirectly proves that most people are optimistic about the long-term development of the Pencils Protocol ecosystem and the long-term value of DAPP tokens. According to the current market situation, DAPP's FDV is only 40 million dollars, which is inconsistent with the project narrative and severely undervalued, making this stage the lowest cost phase for holding and positioning DAPP.