Explanation
The tunneling technology used for the fabric data plane is based on Virtual Extensible LAN (VXLAN). VXLAN encapsulation is UDP based, meaning that it can be forwarded by any IP-based network (legacy or third party) and creates the overlay network for the SD-Access fabric. Although LISP is the control plane for the SD-Access fabric, it does not use LISP data encapsulation for the data plane; instead, it uses VXLAN encapsulation because it is capable of encapsulating the original Ethernet header to perform MAC-in-IP encapsulation, while LISP does not. Using VXLAN allows the SD-Access fabric to support Layer 2 and Layer 3 virtual topologies (overlays) and the ability to operate over any IP-based network with built-in network segmentation (VRF instance/VN) and built-in group-based policy.
Reference: CCNP and CCIE Enterprise Core ENCOR 350-401 Official Cert Guide