XYO Describes Itself As

XYO is a Decentralized Physical Infrastructure Network (DePIN) developed to create a fully trustless oracle for both Web3 and Web2 applications. Launched by XY Labs, Inc. in 2018, XYO began as a decentralized location oracle and has since evolved into a broader ecosystem for decentralized data aggregation and analysis. The XYO network leverages a global array of nodes, including mobile and desktop devices, to gather and validate a wide range of data. XYO focuses on providing data sovereignty, ensuring users retain control over their data while enabling its use in various applications, including AI modeling, metaverse projects, and data analytics.

Project Function

XYO functions as an enabler of decentralized data sovereignty through its DePIN ecosystem, which includes consumer software, developer tools, and a decentralized network. It incentivizes data aggregation and validation by rewarding participants with the XYO token. The platform is designed to facilitate the collection and use of decentralized data across multiple sectors, offering immutable and tamper-resistant blockchain data. The XYO ecosystem also provides tools and SDKs for developers to build applications that integrate with its network, allowing third-party developers to tap into its extensive data library.

Token Utility

The XYO token is a deflationary ERC-20 token that powers the XYO ecosystem. It serves as the primary currency within the network, used as payment to receive data, as well as to reward users for contributing data. The token incentivizes user participation, ensuring that data aggregated within the network is willingly and anonymously provided. XYO's governance structure is based on protocol-driven participation, where changes are adopted based on majority consensus among network participants.

About the Founders

XYO was co-founded by Arie Trouw and Markus Levin. Arie Trouw is a seasoned entrepreneur with extensive experience in software development and technology startups. Markus Levin has a background in business development and management. Together, they identified the need for a decentralized, trustless location oracle, which led to the creation and subsequent expansion of XYO into a comprehensive DePIN ecosystem. Under their leadership, XY Labs also became one of the first companies to tokenize its stock and list it on an alternative trading system.

Risks of XYO

Like an investment in other crypto assets, there are some general risks to investing in XYO. These include:  (i) volatility risk and liquidity risk, (ii) short history risk, (iii) demand risk, (iv) forking risk, (v) code defects, (vi) regulatory risk, (vii) electronic trading risk, and (viii) cyber security risk. For additional information of these and other general risks associated with crypto assets and Uphold’s platform, please refer to the Risks Specific to Holding Digital Assets statement.

In addition to these general risks, an investment in XYO is subject to the following specific risks:

• Any potential success associated with XYO depends on its rate of adoption by decentralized applications. There are a number of competing oracle platforms such as Chainlink and Band Protocol.
• Any potential success associated with XYO depends on a number of external factors, such as the continued growth of decentralized applications and their need for having data validated by other blockchains.
• In July 2022, the SEC claimed in a court filing that XYO was one of at least nine digital assets listed on the cryptocurrency exchange Coinbase, as being an unregistered securities.

We emphasize that this Crypto Asset Statement is not an exhaustive description or summary of all risks associated with XYO. Investors should conduct their own research and perform their own assessment before trading any crypto asset to determine the appropriate level of risk for their personal circumstances.

The XYO community and founding team are not under any legal or regulatory obligation to disclose material information to the public regarding its activities. Holders of XYO have no recourse to the XYO community, its founding team, or Uphold if XYO declines in value for any reason.

Changes to applicable law may adversely affect the use, transfer, exchange, or value of any of your crypto assets, and such changes may be sudden and without notice.

Uphold’s Evaluation Process

Prior to listing XYO on the Uphold Platform, Uphold performed due diligence on XYO and determined that XYO is unlikely to be a security or derivative under relevant securities legislation. Uphold’s analysis including reviewing publicly available information on the following: 

• The creation, governance, usage, and design of XYO, including ensuring the source code is open-source, audited and peer reviewed, security, and roadmap for growth in the developer community. 
• The supply, demand, maturity, utility, and liquidity of XYO.
• Any marketing materials put forward by the XYO social team including on, Twitter, Medium blog, LinkedIn posts, Discord and Telegram channels.
• Material technical risks associated with XYO, including any code defects, security breaches and other threats concerning XYO and its supporting blockchain (such as the susceptibility to hacking and impact of forking), or the practices and protocols that apply to them.
• Legal and regulatory risks associated with XYO, including any pending, potential, or prior civil, regulatory, criminal, or enforcement action relating to the issuance, distribution, or use of XYO. 

General

Uphold has prepared this Crypto Asset Statement based on publicly available information. Although Uphold has taken steps to obtain information from apparently reliable sources, information contained in this Crypto Asset Statement may be inaccurate, incomplete or out-of-date. This overview is a starting point for you to perform your own research prior to investing in a crypto asset.

Uphold users should read the Risks Specific To Holding Digital Assets statement for additional discussion of general risks associated with crypto assets made available through the Uphold platform.  

Canadian residents, please note that Uphold has filed an application for registration in certain Canadian jurisdictions but has not yet obtained registration. Until such time as Uphold obtains registration, Uphold has agreed to abide by the terms of an undertaking available at the following link. Please also review the Uphold Canada – Crypto Risk Statement for additional discussion of general risks associated with the crypto assets made available through Uphold Platform. Please be aware that statutory rights of action for damages or rescission in section 130.1 of the Securities Act (Ontario) and, if applicable, similar statutory rights under securities legislation in the other provinces and territories of Canada do not apply in respect of this Crypto Asset Statement or other disclosures on the Uphold website and Risks Specific To Holding Digital Assets statement. 

Last updated on September 2, 2024.