Blockchain’s First DePIN Project Launches its Own DePIN-focused L1

XYO, the blockchain industry’s first DePIN project, with 80% of its users coming from outside the crypto space, is migrating its XYO Network ecosystem to its own DePIN, RWA, AI and data-focused L1. The network launched in 2018, predating the term DePIN, and is designed to enhance the validity, certainty, and value of real-world data, AI-training data, and virtually any other kind of critical data.

Today, XYO is launching a public beta of the testnet blockchain and is already in discussion with multiple data-driven projects looking to build on top of it. The decision to transition to a new Layer 1 was driven by the demand for a high-throughput blockchain: XYO and its partners will process large volumes of real-time data with low latency and data validation capabilities. No other blockchain meets XYO’s demanding specifications.

As part of its move to its own, next-gen Layer 1, XYO is introducing a new consensus mechanism called Proof of Perfect. This mechanism uses an algorithm that enables decentralized nodes to identify and rank the best chain to add new blocks to, based on how perfect each available chain is.

This ranking system evaluates each chain tip based on its validity, recency, and protocol alignment — allowing nodes to agree quickly on the most “perfect” chain to extend, without processing its full history or relying on energy-intensive consensus methods.

“Having developed on blockchain for years, I’ve seen firsthand where the current systems fall short. The community is ready for a system that can handle both high volumes of data and maintain true decentralization. XYO addresses the pain points that have held back developers and consumers for years—bloat, inefficiency, and the gentrification of participation. XYO provides the tools that developers need to build, and the means for anyone to participate, regardless of resources.”
— Arie Trouw, XYO Co-Founder & CEO of XY Labs

In addition to this, new technologies in Layer 1 enable block producers to make faster and more consistent decisions, removing the need for them to process and store all the transactions on the entire chain. This outdated process is a major bottleneck in most traditional blockchains.

Traditional chains require nodes to store and validate their full chain history. XYO Layer One introduces lookback windowing, which drastically reduces storage requirements by narrowing each node’s active memory to the most recent transactions. Older data is archived but remains accessible.

This lightweight model improves transaction speeds, and minimizes hardware strain for DePIN, RWA, AI and other data-heavy projects.

The native XYO token functions as a deflationary asset with a fixed supply, primarily serving governance, payment, and staking roles within the network. It does what it was designed to do—secure the protocol and align long-term incentives—flawlessly and will continue to do so for the lifespan of XYO.

For handling the continuous, high-volume transactional demands of a Layer 1, particularly in areas such as gas fees, base fees, and transaction prioritization, a visionary new concept is needed.

XYO is debuting a dual-token model and introducing a new symbiotic token native to XYO Layer One: XL1.

This innovation is momentous for XYO. XL1 is an inflationary token purpose-built to act as the economic engine of XYO’s native blockchain. It complements the original XYO token by taking on the role of high-frequency utility while preserving and enhancing XYO’s long-term value function.

XL1 powers the day-to-day mechanics of the XYO Layer One network, such as:

• Payment of base and gas fees for transactions
• Smart contract execution
• Priority fees
• Rewards for active network participants and efficiency nodes

XL1 can be obtained by staking XYO Tokens, which locks in XYO as the permanent governance token for XYO Layer One and maintains its relevance for XYO’s native blockchain in perpetuity. A significant portion of XYO’s circulating supply is expected to be locked within the XYO Layer One blockchain long-term through this twofold incentivization and locking mechanism.

Through staking, participants will not only earn XL1, enabling them to interact with all functions of XYO Layer One, they’ll also be critical to the overall security, reliability, and efficiency of the XYO ecosystem.

This dual-token architecture ensures a clean separation of concerns:

• XYO strengthens its role in governance, staking, and long-term value alignment
• XL1 enables scalable, responsive, and high-throughput network operations

By decoupling governance from transactional utility and designing incentives to drive both performance and security, this next-generation token model lays the foundation for a truly scalable, decentralized infrastructure network that is optimized for the next wave of DePIN, AI, and data innovation.

About XYO

Founded in 2018, XYO is the first DePIN and one of the largest, with over 8 million nodes. XYO collects and validates real-world data, connecting Web3, Web2, and industries like AI and geolocation. Their Proof of Location and Proof of Origin technologies power real-world asset tracking, DePIN solutions, and interactive gaming experiences.

XYO created the COIN app to drive network growth, and their XYO token is listed on major exchanges like Coinbase.

In addition to the XYO Foundation, they founded XY Labs Inc., the first crypto company in the U.S. to gain SEC approval for a Regulation A offering, allowing both accredited and non-accredited investors. XY Labs is also one of the first to tokenize and list its shares, trading under XYLB on tZERO ATS, leading the charge in the RWA wave.

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