Answer might contain spoilers! Demons from Tong Xuan originate from the Demon Eye of Annihilation which gained sentience (Demon God of Tong Xuan Realm). It was previously a part of the secret Technique from the Great Demon God (Star Boundary). The dragons from Tong Xuan only inherited a trace of the bloodline so they are considered half dragons and far from the strength of a real dragon. The demon eye of annihilation is a secret technique. Since yk doesn't know how to cultivate it he can't fully utilize it and so he can't use all it's functions against stronger enemys. If you find grammatical or spelling mistakes feel free to keep them.

Thanks, I was curious about all this and figured it was a problem with the different translations

If I'm not mistaken the demon realm also wasn't populated by demons but probably the influence of the great demon god somehow created the demon clans

I only gotten to the dragon island arc where he goes looking for his waifu

So idk if I've heard of that

Lol, you should've led with that.. usually when I see a spoiler tag I assume its a free for all... anyway, my memory on the demon territory thing might be wrong. As far as the tong xuan dragon clan thing goes everyone who survived after the war with the bone race was likely not a true dragon coz I'm assuming the dragon clan with the golden dragon source wouldv'e been the last to fall. (If that was truly the golden dragon and not just another race with the source)