Dual-Token Model

XYO Layer One uses a dual-token model to create a powerful, scalable blockchain ecosystem optimized for DePIN, data, and AI applications. This structure separates the foundational and transactional layers of the network, ensuring long-term sustainability without compromising speed or usability. The two tokens—XYO and XL1—each serve a distinct purpose that contributes to the health and growth of the network.

XYO is a deflationary token with a fixed supply. It is designed for staking and securing the network, offering long-term value alignment and stability. Token holders who stake XYO contribute to the structural integrity of the blockchain, reinforcing trust and decentralization across the ecosystem.

XL1, by contrast, is the utility token that powers day-to-day activity on XYO Layer One. It is described as inflationary, but this inflation is deliberately restrained—capped at a 2% annual inflation rate. XL1 is used for gas fees, smart contract execution, real-time rewards, and other core functions of the blockchain. Importantly, as the network scales, transaction-based burning mechanisms are expected to offset or even exceed the token’s inflation rate, making XL1 effectively deflationary through active use. This design ensures that XL1 maintains economic balance and long-term value alignment, even while supporting high-throughput applications.