I had a theory for what happened to Pencil in TPOT 19. My theory would be on a basis that One's deals always had a catch, like Gaty's or the ones sent to One's Domain, for example.
Basically, Pencil would actually get sent back to early BFDI, but the catch is that Pencil had her memory wiped. Squeaked clean, no trace of the past. The main reason of this is that since she doesn't know of the future, she would redo the mistakes that got her to where she was in TPOT, thus making the deal for nothing.
I mainly made this theory just because One would most definitely have one more kick on the way out after gaining all of that power.
ohhh my god time loop Pencil. As though she hasn't been through enough!. I like that. Judging by the glitching left by Pencil in TPOT 19, it's safe to say that she was either erased or sent back in time-- so definitely a possibility.
If it is a time loop, if she is stuck unaware, the new question becomes: can we get her back? If we can, she doesn't need to be disqualified. But her disappearing for long enough would likely do that and I'm keeping elimination order the same.
This is all up One's ally, too. They have loopholes in their deals. Honestly, she probably doesn't even need to stick to them, as she proves that she can STRAIGHT UP LIE on her end in TPOT 13.
Meanwhile, those who sign basically lose their rights to their soul. One makes people owe her favors-- or she will force them to act on their end of the deal once the time comes.
She isn't here to play fair. She doesn't mind being dirty to get her way. Ultimately, One wants power and control and the deals get her that. When they don't, she is willing to use intimidation or manipulation. Some deals are with people she thinks have a chance of winning TPOT, other deals are because she sees good leverage, and most deals are just. Straight up to feel in control. At the end of the day, her priority is feeling powerful and getting her way.
Her power trips are a problem. She waited it out with Two, got a sliver of their power, and nearly/possibly killed uncountable algebraliens. When Donut was refusing to sign, One was already feeling frustrated after another failed attempt with Leafy/Firey and she just needed to feel in charge again. She got sloppy both times. The first got her imprisoned and the second got her secret out a little more than she intended.