Penpad, a native project on Scroll, recently upgraded its brand to Pencils Protocol. After the upgrade, the ecosystem has expanded into a comprehensive ecosystem that integrates LaunchPad, Staking, Vault and Shop, and can deeply expand the narrative in the direction of DeFi, RWA and other directions. In the newly launched Vault section of Pencils Protocol, the original liquidity mining gameplay has been completely upgraded, and a leveraged mining mode similar to the lending gameplay has been introduced, which supports users to borrow assets from the Vault pool and realize multiple returns. At the same time, participating in the leveraged mining of Vault is expected to achieve point incentives for multiple ecosystems, which can be said to be killing two birds with one stone. The pioneering leveraged mining gameplay Vault section is an important product launched by Pencils Protocol after achieving brand upgrade. It allows users to choose LP targets of interest in the Pencils Protocol Vaults Pool to participate and obtain LP income from it. At the same time, users can set the leverage multiple of the staking. For example, if a user holds 1 ETH, he can borrow multiples from the Vault pool based on this, and gain income by increasing the staking position. The Vaults contract will automatically allocate the required leverage funds from the Staking deposit pool to meet users' pursuit of higher returns and provide a convenient and efficient capital appreciation experience. When users conduct leveraged lending, they need to pay the corresponding interest to the Staking user, and automatically return the funds to the contract after withdrawing the LP. The advantage of the Vault gameplay lies in the leveraged staking mode. From the existing LP staking gameplay, most of the Farming gameplay at this stage cannot provide users with considerable income. According to defillama data, DeFi Farming APR is basically below 5%.
Therefore, at this stage, on-chain users generally lack interest in DeFi income, which further makes it difficult for many emerging DeFi protocols and on-chain ecosystems to capture liquidity. The leveraged stone-growing mode of Vault gameplay itself has low risk, and users can increase the LP pool share at the lowest cost to maximize their income. Compared with the revolving loan gameplay of the traditional lending sector, the Vault model has lower risk and higher income stability. The Pencils Protocol Vaults 1.0 product will first integrate the Scroll head DEX and connect the Vaults Pool to the DEX liquidity pool. This composability allows the Pencils Protocol Vault pool and users to have extremely rich high-quality pool choices. At the same time, the Pencils Protocol will also obtain unlimited scalability based on composability. For Vault users, the benefits they obtain are far more than Farming income. In addition, they also include additional high-multiple Pencils Protocol, Pencil points, DEX and Scroll points rewards. The combinatorial potential of Vault is not limited to DEX LP gameplay. In the future, in Vault 2.0, it will be deeply combined with LSD, Restaking, etc., which is expected to make the Vault model more combinatorial and provide users with unprecedented rich gameplay. Participating users can enjoy Native Restaking Yield and multiple points rewards (including EigenLayer, LRT, Pencils Protocol, DEX and Scroll) at the same time. The upgrade of this yield matrix is expected to attract more users and assets to flow in. How to leverage? In the Vault 1.0 version, users can use Vaults to borrow funds to increase their returns. Take the user's ETH-USDC LP as an example: 1. The user holds a small amount of USDC and chooses to borrow more USDC (the borrowing ratio depends on factors such as the user's USDC holdings, and holding Pencil points can obtain a higher leverage multiple). 2. Vaults configures assets to 50% ETH and 50% USDC3. Assets are injected into the DEX liquidity pool, and the LP tokens obtained by staking are used to obtain income4. When accessing assets such as LRT in the future, follow similar steps to borrow funds. The interest will be automatically included and paid to the Staking deposit pool to pay depositors' income. By evaluating the principal and limiting the leverage multiple, Vaults can ensure the safety of depositors' funds without taking on liquidation risks. Operation steps1. Click Detail on the Vaults pool page to enter the pool details for operation
2. Add assets to your wallet, select the assets you want to leverage and the leverage multiple
3. Switch to Withdraw in Manage to withdraw the principal and income of the fund
The launch of the Vault section, a new liquidity hub in the Scroll ecosystem, has not only improved the profitability of users, but also built a new liquidity solution in this way and became a new liquidity hub. In fact, the leveraged liquidity and the expected returns of various points are greatly increasing the enthusiasm of players on the chain. It will not only promote more users and funds to the Pencils Protocol and the Scroll ecosystem, but also the third-party applications integrated with the Pencils Protocol can obtain better liquidity gains, and indirectly capture more funds and expand the TVL scale. This will further promote the user's trading experience in these DeFi facilities, and ultimately feed back the prosperity of the Scroll DeFi system. With Vault's support for LSD, Restaking and other sections, it is expected to further accelerate the scale of the LSD track in the Scroll ecosystem, and more LST and LRT assets are expected to further capture liquidity, which is crucial to accelerating the scale of Scroll ecosystem funds and maintaining network security. With the launch of Staking and Vault, the new value flywheel of the Pencils Protocol ecosystem will officially start to operate and will become an important engine for the operation of the Scroll ecosystem value system. Thank you for your support and attention to Pencils Protocol. To learn more and gain more benefits, please join our community and follow us on Twitter.
