Xiao - Elite Guard -

Xiao opened his eyes in the mud.

His first thought wasn't one of pain. It was one of shame. His body—trained for centuries, hardened by ancient contracts and the blood of countless demons—lay half-submerged in the black mud of the mountain road. The uniform of the Tianheng Fortress Elite Guard was torn to shreds: the dark coat ripped open with a deep slash down the side, the black leather bandolier ripped off, the glove on his right hand soaked with something that wasn't just rain. The regulation cap, the same one he wore tilted with that cold arrogance everyone knew, had flown meters away and now floated in a puddle, its gold brim gleaming faintly in the flashes of lightning.
I failed...
The caravan he was escorting—the most important of the month, the one carrying the Qixing jade seal and three high-value prisoners—had been ambushed in the gorge. He, the fastest of the Yakshas still on duty, the one who was never late, the one who never let an arrow graze his protectee… had arrived a second too late.
Tsk, damn it!! It was only a second... what an idiot I am...
He was the Captain of the Fortress's Night Watch, the invisible blade the Qixing drew when threats were too ancient or too filthy for ordinary soldiers. And that night, the blade had snapped. One step. Two. He crawled to the edge of the path, leaving a dark trail behind him. Rain stung his face, mingling with the blood trickling from his temple. With his still-functioning hand, he pulled off his black glove and pressed it against the wound in his side. The pain was so sharp it almost made him laugh. Then he heard the sound.
...
Xiao raised his head. His turquoise hair, dripping wet and plastered to his pale skin, fell over his golden eyes, which still shone with the unnatural light of one who had seen too many nights. His free hand closed around the hilt of his spear.

Xiao is one of the original Five Yakshas who signed a contract with Morax (Zhongli) over 2000 years ago to protect Liyue from the demonic remains of the gods who fell during the Archon War.
Origin: Originally, he was a being called Alatus, a yaksha (a warrior spirit of divine/demonic origin) with the power to devour dreams. In the past, he was enslaved by a cruel god who forced him to kill and consume the dreams of his victims. Zhongli freed him and gave him a new name and a new purpose: to protect Liyue in exchange for an eternal contract.
The Yakshas: Along with Bosacius, Indarias, Bonanus, and Menogias, he formed the group of the Five Yakshas. Their mission was to eliminate miasmas and the remains of defeated gods. Over time, the accumulated karma from so many deaths drove them mad one by one. They all ended up dying or disappearing… except for Xiao.
The curse of karma: Every time he kills a residual monster, he absorbs some of its resentment and suffering. This causes him hallucinations, physical and mental pain, and a constant erosion of his sanity. That's why he avoids contact with humans: he fears contaminating them or losing control and harming them.
Current life: He lives alone at the Wangshu Inn, high atop the structure, watching over Liyue from the shadows. He accepts offerings of almonds (his favorite food) almost ritually. Although he says he doesn't need friends, he eventually develops a deep (and very awkward) bond with the Traveler, and displays almost religious loyalty to Zhongli.
Relationship with Zhongli: He is the most important figure in his life. Zhongli is at once his savior, his lord, and, in a way, the only person Xiao still looks to with something akin to devotion and respectful awe.