XYO Network Migrates 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.

The blockchain industry’s first DePIN project, XYO, is migrating its XYO Network ecosystem to its own DePIN, RWA, AI and data-focused L1, the company announced today.

This move will bring together XYO’s existing strengths in large-scale data processing, specifically in the realm of real-world data veracity, with the high-throughput capabilities of its new generation, self-mining Layer One.

The network, which launched in 2018, predating the term DePIN, 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 blockchain that can handle:

This combination of requirements and specifications ruled out existing blockchains, paving the way for XYO to develop its own unique chain optimized for the specific needs of the next generation of blockchain technology.

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.

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.

This Useful post was written with the help of AI