Hamsters research for fun (XYO Network)

5 min readNov 16, 2021

1/ Project Overview

XYO is a geospatial oracle network of devices that anonymously collects and validates geospatial data envisioned in Dec 2017. The project creates an ecosystem of devices to document the unalterable history of interactions and locations stored on the blockchain. The network runs on XYOMainChain, which is a public blockchain.

The operation of the network relies on four key roles -

The Sentinel (data gatherers) — a physical device that broadcasts signals with location information. When two sentinels are near each other and broadcast the interaction, it’s called Bound Witness.
The Bridge (data relayers) — a physical device finds and places signature on the bound witness
The Archivist (data storers) — a database stores all bound witness interactions
The Diviner (answer aggregators) — a node retrieves data from Archivist & Bridge and answers questions, search engines that connect people to the network

When a user queries a location data via smart contract, the diviner listens to queries, fetches the answer with the best Original Chain Score from the archivist, which was gathered from sentinels and bridges. The diviner then feeds the best answer back into the smart contract, together with the Origin Chain Score.

The Origin Chain Score of the data is determined through a set of zero-knowledge proofs (Proof of Origin Chain). The PoO chain can guarantee two or more pieces of data originated from the same source without revealing underlying information.

The main security risks include:

Fake Diviner Attack — this will be prevented as other diviners need to reach a consensus and sign to agree on the validity of the query result, and the list of signatures will be included in the transaction as well.
Sentinel DDoS Attack — attacker creates a large number of connections to Sentinels to prevent them from relaying correct info to Bridges. The project will prevent this by applying a small cryptographic puzzle for anyone attempting to connect to the Sentinel.

More security risks and solutions can be found at its Red Paper.

The use cases of the network are mainly for tracking objects (or hamsters). In most use cases, a Sentinel is attached to the object that broadcasts location data, then bridges (IoT devices) will hand off the data to decentralized nodes, which will relay and archive the information. The technology can be used to track luggage, medical equipment, courier, and even pets.

2/ Key Products

COIN App

Launched in early 2019, COIN is a mobile app that rewards users COIN for validating geospatial location data using their mobile devices. The activity is called Geomining, Users can then redeem their COIN for $XYO, $ETH, $BTC and other physical goods.

The COIN App can be paired with a Sentinel eXtension device that XYO Network issues to get a reward boost.

According to an article, a geominer only earns ~$5 per month by giving up their location data.

XYO Network Mobile App

Users can do the following with the app:

Manage XYO devices — detect nearby XYO-enabled devices
Swipe between contexts — view local data and summary of XYO network data
View connection status — check, manage and (dis)connect with archivist and diviner
Check PoO chain — view the chronological list of bound witnesses
Switch between Sentinel and Bridge mode

XYO World

Users can mint geotokens, which are ERC-721 NFTs that appear on the XYO World map as quadtiles (digital real estate that can be used to provide data for apps built in XYO World). Users can make a minting deposit in $XYO at auction in XYO World, and 75% of the deposit will be returned to the winner of the auction, while the remaining 25% will be distributed to other owners in the same area of the map, or burned.

The geotokens can be traded or used to create consensus about where the most location activity should be expected.

3/ Development Roadmap

2021 Q4:

XYO 2.0 Diviner (Centralized)
XYO 2.0 Explorer
XYO 2.0 Network Protocol Yellow Paper
Full Deprecation of XYO Protocol 1.0
Stack and SDKs

2022 Q1:

XYO 2.0 Payment Channels
XYO World 4.0
XYO 2.0 Data Marketplace Yellow Paper
XYO 2.0 Data Marketplace

4/ Tokenomics

The Native Utility Token of XYO network is $XYO, which is an ERC-20 token. The token did an ICO during Mar-May 2018 and raised $12M. Unsold and unallocated tokens were burnt after the ICO. The projected $XYO token cap was $48M. Removing the market effect, the token price spiked in early 2019 then dropped and maintained at a low level, until recently it has been listed on Coinbase and Crypto.com, which brings a surge to its price and trading volume.

Basic information:

Circulating Market Cap: $735M
Fully Diluted Market Cap: n.a.
Exchange-listed: Coinbase, Crypto.com, Gate.io, KuCoin, Uniswap v2/v3, Sushiswap

The major utility of $XYO includes:

Users who query from the XYO network need to pay $XYO (price determined by the complexity of the query)
Reward to all components who participate in the data query and use COIN app

Very limited information on the token design (allocation, vesting schedule etc.) is found.

5/ Team and Partners

According to the XY Labs webpage, the team has ~15 people, with 3 engineers (and Phoebe, a dog who is the Head of Office Excitement). Founder Arie Trouw holds a BS degree in Computer Science. He has 4 years of engineering experience, 7 years of PM/consulting experience and has been an entrepreneur since 2008. He founded XYLabs in 2012.

As disclosed by the website, partners of XYO includes CAS Smart City (中科智城), FedEx Institute of Technology, Portis, Chainlink, Harmony, etc.

6/ Key Metrics

User Metrics

According to the announcement, the COIN App has been downloaded more than 3M times.

Social Media Data

Facebook: 24.3K followers
Twitter: 34.3K followers
Telegram: 5.8K members
Reddit: 18.8K members

7/ Investment Risks

Although no strong competitors are present for XYO in the geospatial oracle space, the risks include unclear tokenomics design, lack of information on integration with major chains and DApps. The future of the token price will be depending on whether the team can lock down more partnerships and make more integrations.