# Incentives

In the XYO Layer One ecosystem, incentives are designed to reward meaningful contributions to data integrity, availability, and processing. Whether collecting, validating, or storing data, participants are economically compensated through the network’s dual-token model using [**$XYO**](/xyo-layer-one/dual-token-model/xyo-token.md) and [**$XL1**](/xyo-layer-one/dual-token-model/xl1-token.md).

### Token-Based Compensation

While XL1 is often the choice of compensation for on-chain services, off-chain services can also use XYO. For example, XYO’s DePIN ecosystem utilizes XYO as an incentive and redeem item to encourage accurate and valid data production by contributors.

* **Data collectors** – Individuals or devices that gather real-world data
* **Data processors** – Nodes or applications that transform or enrich data
* **Data storers** – Participants who ensure long-term data availability and access

This flexibility allows for a wide range of decentralized services to operate within the network and be appropriately rewarded.


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