It is the use of the VXLAN overlay technology in the data-plane that provides seamless Layer 2 and Layer 3 connectivity services between endpoints, independently from the physical location (Pod) where they are connected.
https://www.cisco.com/c/en/us/solutions/collateral/data-center-virtualization/application-centric-infrastructure/white-paper-c11-737855.html
It's A
At the same time, seamless Layer 2 and Layer 3 connectivity services can be provided between endpoints independently from the physical location where they are connected and without requiring any specific functionality from the network interconnecting the various Pods.
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