The Paper Knight bonus round rule is one of the many rules that can be applied during the Bonus Round episodes. It spawns around floor 4 or 5 for all characters except the Robot (who doesn't roll dice at the start of their turn).

Paper Knight

Start with 2 extra dice. Lose 1 dice every turn, until you have just 1 left.

When the rule activates, the player will start each fight with 2 extra dice. However, at the start of each turn afterwards, the player will lose 1 dice, unless they only have one dice left.

While this rule seems strong, you will need to prepare well in order to make the most of this rule, since without equipment like Hall of Mirrors (which will only negate the dice loss and doesn't really do much if you only have 1 dice) you can have trouble if you have too many dice.

Additionally, there are many enemies on the later floors, like Rhino Beetle, Paper Knight, and Gargoyle, who can Lock dice, preventing you from even using the one dice you have.