Pencils Protocol

Pencils Protocol project overview

• Project concept
• Team
• Investors
• Token Utility & Tokenomics
• Social networks & links

The Ethereum network has long needed scaling to accelerate transactions. To address such large-scale challenges, modern Layer 2 solutions, such as blockchains like Arbitrum, Optimism, Starknet, and ZkSynk, have started to emerge. These Layer 2 networks will enable faster transactions on the Ethereum network, making them cheaper for users.

Another major Layer 2 blockchain for scaling Ethereum — Scroll.

Scroll uses ZK-rollups — bundles or packages with zero-knowledge proofs (ZKP).

Rollup — a technology that enhances Ethereum's performance. A large number of transactions in the Scroll (L2) blockchain are grouped together for further processing on the Ethereum network (L1). The data resulting from this processing is then transmitted back to the Scroll network using data compression methods, significantly reducing fees and increasing transaction speed.

ZK — technology that ensures the privacy of user data without revealing excessive information about the parties or the contents of the transactions.

ZK — the most advanced Web3 technology today, also used by L2 blockchains Starknet and ZkSync. These three Layer 2 networks hold leading positions among L2 solutions.

Scroll successfully raised $80 million in funding from Polychain Capital, Sequoia, and OKX Ventures at a valuation of $4 billion.

Scroll is valuable for its EVM equivalence, which allows developers to easily port their applications from Ethereum to Scroll. This will enable it to take the top spot among ZK-rollups.

The leading network will be the one that deploys the most efficient and popular DeFi applications and useful services, attracting new users and increasing financial flows. Such a useful service for the Scroll blockchain will be the Pencils Protocol.

The functionalities of the Pencils Protocol launchpad include:

• auction platform that helps new projects launch;
• validator hosting platform;
• marketplace for NFTs, gaming components, and nodes.

The yield tools of Pencils Protocol include

• yield aggregator;
• exchanges, loans;
• liquid staking and restaking.

Users can stake various assets, including BTC and ETH derivatives, stablecoins, and Pencils Protocol platform tokens.

At the end of July 2024, the total value locked (TVL) in the Pencils Protocol exceeded $300 million, making it the largest DeFi protocol by TVL in the Scroll ecosystem.
Additionally, Pencils Protocol leads in weekly and monthly TVL growth rates and other metrics within the Scroll ecosystem.

When users stake assets in the Pencils Protocol, they receive pETH, pWBTC, or any other «pToken"».
A pToken can be considered a sort of certificate indicating that the underlying token is staked. Users can earn additional yield in restaking pools on top of the basic rewards for the tokens.

The team is implementing a bonus points system called Pencils on their platform to encourage user activity in liquid staking. In this way, Pencils Protocol attracts liquidity to its ecosystem.

Features of Pencils Protocol technology

Let's look at a few of these innovative technologies.

• Proof of Humanity The "Proof of Humanity" system — combines social verification with video biometric data verification of the user. This technology distinguishes real users from bots and prevents users from creating multiple accounts.
  
  "Proof of Humanity" ensures a secure and simple login process that maintains user privacy while complying with KYC (Know Your Customer) and AML (Anti-Money Laundering) regulations. Pencils Protocol uses the scalability of Scroll to integrate with real social networks, email verification systems, and biometric technologies, ensuring account authenticity during login and effectively preventing spam bot registration.
  
  While operating on the Pencils Protocol platform, users are guaranteed security. Software developers are assured compliance with new regulatory requirements for Web3 projects. For instance, Pencils Protocol includes features like the "Deposit Manager" and "Filter" to detect and prevent illegal fund transfers.
• Support for user account abstraction Account abstraction — method of configuring a blockchain network where user assets are stored exclusively in smart contracts rather than external accounts. By treating user accounts as smart contracts, third-party developers can implement complex logic and automation in their applications.
  This feature ensures more dynamic user interactions, a higher security standard, and a more user-friendly interface. Account abstraction can also be combined with other ZK features to enhance privacy and regulatory compliance.
  

Supported by ZK technology, Pencils Protocol offers a modular approach to supporting the various needs of third-party projects and teams. It also includes "proof of humanity," account abstraction, scalability through ZK and EVM, privacy, and integration with real-world applications.

Pencils Protocol optimizes capital flow within the ecosystem, ensuring seamless integration and interaction between various funds and projects.

Investors see the value in the Pencils Protocol project as it is the flagship of the Scroll blockchain. As the Scroll ecosystem develops, the number of users in Pencils Protocol will increase.

Team

An experienced team of developers from Singapore and Hong Kong with a strong background in successful global projects.

• Wesley Xia — co-founder and CEO.
  Formerly Vice President of the crypto exchange Huobi Global, Head of the Huobi Ecosystem Chain, and Head of Huobi Global North America Development Department. Successfully increased the TVL of the Huobi ecosystem to $16 billion. Additionally, he was a co-founder of the Matryx project, which successfully listed on the Huobi Global exchange in 2017, leading to a 3700% (37x) increase in its token value.
  https://www.linkedin.com/in/weihao-xia-125401b4/
• Peter Zhou — co-founder and CTO.
  Peter was a senior machine learning research engineer at Apple, responsible for Apple's financial products, including Apple Wallet, Apple Pay, Apple Card, and Apple Cash. Before Apple, he was a portfolio manager for structured credit derivatives worth $4 billion at Capital One. Previously, he worked at Qsemble Capital, a renowned Wall Street hedge fund with $6.5 billion in assets under management.
  https://www.linkedin.com/in/peter-zhou-cfa-frm-719857128/
• Daniel Finley — strategy director.
  Formerly a global strategist at Findora, where he was a key architect in shaping the organization's development trajectory. Thanks to his strategic vision, the company remained successful for a long time and continues to be competitive in the new business environment.
  https://www.linkedin.com/in/daniel-finley-482a12133/

Investors

Strong investors led by crypto industry leaders OKX Ventures and Animoca Brands.

• OKX Ventures — investment arm of the globally renowned crypto exchange OKX, with a capital of $100 million. The fund invests in foundational blockchain infrastructure projects, such as Polkadot, Ethereum Layer 2, DeFi, and the Filecoin ecosystem. The global network created by OKX includes media, influencers, and key players in the crypto community. The fund uses these connections to help growing startups by introducing them to the right people in the industry and enhancing the expertise of their teams. OKX Ventures not only invests in projects but also improves their products and services.
• Animoca Brands — legendary venture fund known for creating wealth through investments in crypto games like Axie Infinity, The Sandbox, and CryptoKitties. It invests not only in gaming projects but is also a lead investor in the well-known NFT marketplace OpenSea. Animoca Brands acts as a publisher and developer of mobile games and applications, as well as various educational products. The company is listed by the Financial Times as one of the fastest-growing companies in the Asia-Pacific region, with a valuation exceeding $1 billion.

Among the investors are also the venture arm of the major crypto exchange Gate.io and the leading Web3 credential network Galxe. Sandy Peng — co-founder of the Scroll network — is also among the backers of Pencils Protocol. Sandy Peng acted as an angel investor, demonstrating an understanding of the value of the flagship project of his blockchain.

Token Utility

1. Governance $PDD, as a governance token, allows holders to participate in community votes, make decisions on the direction of Pencils Protocol development, interest rates, yield policies, and more.
2. Dividends Holders of $PDD periodically receive a portion of the income from asset management within Pencils Protocol and a share of the interest earned from funds placed in vaults.
3. Supporting the Auction Platform Sellers on the auction platform must stake $PDD tokens to list assets in auctions. The auction process is regulated and overseen by the community.

Tokenomics

• Token ticker: $PDD
• Total supply: 100 million
• Network: Scroll (Etherum L2)
• Our round Strategic (round valuation $2 million at a project valuation of $80 million)
• Token price: $0.80
• Conditions: TGE 15%, no cliff, followed by linear unlock over 12 months
• TGE: September 2024

The public sale will take place on the OKX Jumpstart or ByBit Launchpad.
The listing will occur on the ByBit, OKX, and Gate.io exchanges.

Social networks & links

🌐 Website: https://pencilsprotocol.io/

💻 Documentation: https://gitbook.pencilsprotocol.io/overview/pencils-protocol-whitepaper

🐦 Twitter: https://twitter.com/pencilsprotocol

💻 Telegram: https://t.me/pencilsprotocol

💻 Discord: https://discord.com/invite/v5nb2Q3Zt3

💻 Medium (blog): https://medium.com/@PencilsProtocol

💻 Gitbook: https://pencilsprotocol.gitbook.io/overview

Insider Club © Copyright 2024. All rights reserved