What's So Special About XAI, Arbitrum's Gaming Flagship?
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What's So Special About XAI, Arbitrum's Gaming Flagship?
Among numerous gaming public blockchains, what backing and strength does XAI, as a rising newcomer, have that enabled its debut listing on Binance?
Navigating Web3 tides with focused insightsAuthor: dt, DODO Research
Editor: Lisa
On January 3, 2024, Binance announced its latest Launchpool project—XAI. According to the official website, XAI is a blockchain gaming chain "developed for mass adoption." However, blockchain gaming chains are hardly new. Among numerous existing gaming chains, what unique advantages does the relatively new XAI possess that earned it a Binance listing? The last sentence of the project documentation reveals the secret: "Xai is developed by Offchain Labs leveraging Arbitrum technology." It turns out XAI is an Arbitrum Orbit L3 chain directly supported and co-developed by Offchain Labs, the team behind Arbitrum.
This week's CryptoSnap, Dr. DODO breaks down the key features of this officially backed Arbitrum L3 gaming chain!
Technical Foundation
To understand XAI’s technical foundation, one must first grasp the concept of Arbitrum Orbit L3 chains. As Dr. DODO explained during last June’s Megascope, Arbitrum Orbit is essentially an L3 upgrade built on top of the Arbitrum L2 Rollup—a scalability solution for settlement layers that allows developers to launch their own chains with one click. XAI is an Orbit L3 chain built upon Arbitrum Nitro. Arbitrum Nitro directly compiles the core of Geth into its client software base layer, significantly improving Ethereum compatibility. It also integrates modules such as BOLD and Stylus: BOLD enables permissionless fraud proofs, greatly reducing withdrawal delays; Stylus supports multi-language development, improving efficiency and enabling seamless migration from other blockchains to Arbitrum.
In short, Nitro provides XAI with a stable, secure, and efficient foundation. Seamless interoperability with Arbitrum One and Nova directly connects XAI to a richer ecosystem. Compared to building a standalone independent chain, XAI’s use of Arbitrum’s ready-made infrastructure makes development far more efficient.
Token Economics
Arbitrum Orbit grants L3 chains significant autonomy, including freedom in consensus mechanisms, governance models, gas fee tokens, and economic design. This allows XAI to implement a distinctive tokenomic model—similar to GMX’s esToken dual-token system. The native token XAI and its staked counterpart esXAI form a deflationary dual-token structure. The two tokens are exchangeable, with conversion ratios changing over time. XAI serves as both a governance and gas token, powering network operations; esXAI functions as a reward token distributed via staking to incentivize node operators and support ecosystem infrastructure.
XAI Token Distribution
The total supply of XAI is 2.5 billion tokens. Initial allocation is as follows:
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Team and early contributors: 20% of tokens unlocked gradually over 42 months.
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Investors: 22.41% of tokens unlocked gradually over 30 months.
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Ecosystem: 2% immediately unlocked for market making; 5.5% unlocked over 42 months for ecosystem development.
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Points rewards: 50.1% distributed as esXAI, with the XAI redemption rate varying over time.
Gaming Ecosystem
Next comes the most crucial aspect for any gaming chain—the gaming ecosystem. According to the official website, five games are currently in development. The first to launch will be Final Form, a card-based battle game offering an immersive experience combining collectible cards, Roguelite elements, and combat mechanics. Players can evolve their cards and join alliances to earn rewards. Final Form is developed by Ex Populus Studio, founded by former developers from major game studios. Ex Populus is also the official game development partner of XAI and will operate under the guidance of the XAI Foundation, leading game development efforts within the ecosystem.
Beyond Ex Populus, XAI has formed strategic partnerships with several industry leaders, including Tencent and Animoca Brands. These collaborations bring rich gaming resources and distribution channels to XAI. In the future, we can expect a wave of high-quality titles emerging from the XAI ecosystem, creating a deep and expansive gaming universe across multiple dimensions.
Strategic Positioning
The launch of XAI also highlights the intense competition between Arbitrum and Optimism. While Optimism aggressively expands its OP Stack Layer 2 ecosystem, Arbitrum has chosen a vertical dive into gaming via a customized third-layer blockchain. This highly specialized strategy not only significantly boosts performance but also better meets the specific needs of gaming users.
As a strategic initiative of Arbitrum, XAI injects strong growth momentum and opens up new avenues for expansion. Rather than engaging in direct head-to-head competition with Optimism, Arbitrum’s approach of vertical integration—avoiding red oceans and targeting blue ones—demonstrates the team’s sharp market insight and strategic discipline.
Author’s Viewpoint
As the Dencun upgrade draws nearer, many tokens within the Ethereum Rollup ecosystem have started rising. Even $ARB, once jokingly called a stablecoin, has quietly doubled. As Arbitrum’s “official child project,” XAI—now further elevated by Binance’s endorsement—is seeing its valuation surge even higher.
With its strong branding as an Arbitrum L3 chain, combined with technological innovation, thoughtful economic design, and application expansion, XAI is emerging as a rising star in the blockchain gaming space. Its valuation could be benchmarked against similar projects like Myria or even Gala. Of course, strong backing doesn’t guarantee great products—this will depend on the team’s ability to attract more top-tier game studios to build on XAI. If the gaming ecosystem succeeds, XAI’s user base and commercial value could grow exponentially. This would validate Arbitrum’s competitive strength in the Layer 2 landscape—and gamers will benefit from smoother, more seamless experiences.
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Dr.DODO
