As the Pencils Protocol completes the IDO of DAPP on platforms including 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 ecological economic system.
After the trading of DAPP opens, the token has also initiated short-term Staking activities on Gate, Bybit, and Pencils Protocol, with Staking APY reportedly 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.
As Pencils Protocol continues to promote a series of market developments, the low circulation of DAPP is expected to capture value continuously in the subsequent market and enter 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 users to gain 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. Users will enjoy 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 points from Farming, leverage mining and asset management in the Vaults section, or the upcoming Auction models. This is particularly necessary for whale investors, LRT project parties, and AI and FHE projects that also 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, Vaults will use 30% of its profit to buy back DAPP tokens to accelerate its deflation, and other sections will gradually use profits to buy back DAPP tokens in the future.
Thus, from a mechanical perspective, DAPP will have essential demand, especially with the burning mechanism that will continuously generate deflation.
Low circulation of DAPP
The total supply of DAPP tokens is 100 million, which is relatively small compared to other tokens that often have total supplies in the billions of dollars. In terms of token distribution, almost all sections have lock-up periods; 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% after 30 days, and the remaining 25% after 60 days post-TGE.
Currently, only a few million DAPP tokens are circulating in the market, and at this stage, the introduction 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 chips are scarce and are more likely to be pumped in the future! Market sentiment continues to drive 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 individuals are accumulating chips, 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 the DAPP token. According to the current market situation, the FDV of DAPP is only 40 million dollars, which is inconsistent with the project narrative and severely undervalued. Therefore, this stage is the lowest cost phase for holding and positioning DAPP.