What Is XL1? The Utility Token of XYO Layer One

XYO Layer One is the blockchain built to extend the reach of the XYO network, which has operated for years as a decentralized system for verifying location and origin data. The purpose of the chain is to bring this information on-chain at scale, so that it can be used directly by applications in artificial intelligence, logistics, supply chains, and other fields where trust in data is critical. Unlike earlier stages of the project, which relied on off-chain reporting by millions of devices, XYO Layer One provides a permanent and verifiable record of that information within a blockchain framework.

The chain was designed with high throughput in mind, since it must process large volumes of incoming data. It also supports smart contracts and decentralized applications, which can be built around the verified data feeds supplied by the XYO network. In this way, XYO Layer One functions not only as a blockchain for transactions but as a platform for anchoring real-world information to an immutable ledger. This creates the foundation on which its utility token, XL1, operates.

What Is XL1?

XL1 is the native utility token of the XYO Layer One blockchain. It was introduced to manage the core activities of the network, including transaction fees, validator rewards, and the operation of smart contracts. By design, XL1 is the medium that ensures the chain functions smoothly on a daily basis. A portion of every transaction fee is permanently burned, which helps to slow down supply growth over time. The token can also be bridged or wrapped, allowing it to move between XYO Layer One and other blockchains when interoperability is required.

While XL1 is central to the blockchain’s operations, it does not replace the original XYO token. Instead, the two tokens share responsibilities within a dual system. The XYO token continues to handle governance and staking within the wider oracle network, which has been active for years. XL1, on the other hand, takes on the operational role within XYO Layer One, ensuring that transactions are processed, validators are incentivized, and the network remains functional. Together, they form a structure that separates long-term governance from everyday utility.

How XL1 Works

XL1 functions as the operational currency of XYO Layer One. It is the token that makes the blockchain usable, covering everything from transactions to validator incentives. By design, it ties together network security, utility, and interoperability.

● Transaction Fees: Every action on the chain, such as transfers or smart contract calls, is paid for in XL1.

● Validator Rewards: Nodes that validate blocks and secure the chain earn XL1 as compensation for their work.

● Fee Burning: A portion of the base fees is permanently destroyed, reducing the overall supply and offsetting new issuance.

● Cross-Chain Bridges: XL1 can be wrapped or bridged to other blockchains, allowing the network’s verified data to reach external ecosystems.

● Application Support: Decentralized applications built on XYO Layer One use XL1 to execute and interact with smart contracts.

Together these features ensure that XL1 is not only the fee token for the blockchain but also a tool for extending XYO’s reach to other chains. It supports both the internal economy of XYO Layer One and its broader connections with the wider crypto environment.

XL1 Tokenomics

XL1 was launched with a total supply of 38 billion tokens, though only about 5.73 billion are in circulation at present. The remainder is locked and will be released gradually through staking rewards, validator incentives, and long-term vesting schedules. This staged release is meant to prevent sharp supply shocks while ensuring that contributors to the network are rewarded for their role in keeping it active and secure. Inflation begins at a higher rate to encourage early participation but is designed to taper down to an annual level of about 0.7%.

To offset new issuance, the network includes a burn mechanism in which part of every transaction fee is permanently destroyed. Most of the token supply is reserved for community rewards and emissions, while team and early investor allocations are subject to extended vesting periods. In addition, holders of the original XYO token can stake it to receive XL1, linking the two assets and encouraging long-term commitment to the ecosystem. This framework attempts to balance fair distribution with controlled inflation, giving XL1 both immediate utility and potential sustainability over time.

XL1 Price Prediction for 2025

XL1 Price

Source: CoinMarketCap

As of this writing, XL1 is trading around $0.00126 per token, with a circulating supply of about 5.73 billion and a total supply of 38 billion. Its market capitalization stands near $7.2 million. The token is still in its early stages, and most of the supply remains locked, which means upcoming releases will influence price movements significantly.

● Optimistic Scenario: If XYO Layer One gains traction in areas like AI, logistics, and decentralized data services, demand for XL1 could rise sharply. Staking rewards and fee burns would help absorb new supply as it unlocks, while positive market conditions could further lift sentiment. Under these circumstances, XL1 might reach $0.0030 to $0.0050 by the end of 2025, representing a gain of about 2.5 to 4 times the current price.

● Moderate Scenario: If adoption grows more slowly, with only modest partnerships and limited developer activity, the price may see steadier progress. Token unlocks would add supply, but the effects could be partly offset by staking mechanisms and transaction burns. In this environment, XL1 could settle in the range of $0.0018 to $0.0025, reflecting moderate growth of 50% to 100% over current levels.

● Pessimistic Scenario: If XYO Layer One struggles to attract real-world use and most interest remains speculative, large token releases could outweigh demand. Combined with a weaker crypto market, this could push XL1 lower, potentially into the $0.0005 to $0.0012 range, leaving it flat or down compared with today.

Is XL1 a Good Investment?

Whether XL1 can be considered a sound investment depends largely on how quickly XYO Layer One attracts meaningful use. The token benefits from clear utility, since it powers transactions, contracts, and validator rewards, and it is supported by an existing community built around the older XYO network. These factors give it more grounding than many new tokens.

At the same time, risks remain significant. The majority of supply is still locked, and as tokens are gradually released, they may place downward pressure on the market unless adoption grows in parallel. The project’s success will be based on convincing developers and enterprises to anchor real-world data to its chain, and without such adoption, XL1 could remain speculative for an extended period. For investors, it may be prudent to monitor network activity, the pace of token unlocks, and broader market conditions before treating XL1 as a long-term position.

Conclusion

XL1 has been designed to take on the practical responsibilities of XYO Layer One, providing the token needed for transactions, validator incentives, and application support. It complements the older XYO token rather than replacing it, creating a framework where governance and network oversight are separated from daily operations. The inclusion of mechanisms such as fee burning, staking rewards, and bridging gives XL1 a role that extends beyond simple transactions.

What remains to be seen is how far XYO Layer One will reach in practice. If industries begin to anchor real-world data to the chain and developers adopt it for applications, XL1 may grow into a token with steady demand. If progress is slower, supply unlocks and limited usage could weigh on its value. At this stage, XL1 stands as a young asset with a clear function and an uncertain future, leaving room for careful observation and continued interest as the network develops.

Follow Bitget X Now & Win 1 BTC – Don’t Miss Out!

Disclaimer: The opinions expressed in this article are for informational purposes only. This article does not constitute an endorsement of any of the products and services discussed or investment, financial, or trading advice. Qualified professionals should be consulted prior to making financial decisions.