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Back in May 2025, crypto behemoth Coinbase unveiled x402: an open protocol enabling instant stablecoin payments, treating payments as first-class web interactions.
The goal: powerfully automated, frictionless value exchange on the web, for humans and autonomous agents alike. Use cases include pay-per-API calls, metered services, AI agents buying compute/data in-real-time.
x402 leverages the HTTP “402 Payment Required” status code to embed payment requests into standard web API responses. Thus, clients (apps, browsers, AI agents) can respond with a signed stablecoin payment and receive the resource, all in one flow.
Crypto exchange Coinbase has unveiled the x402 protocol to automate online payments with stablecoins, allowing direct transactions from holder to merchant
At launch, the initiative was backed by industry leaders such as Circle (issuer of USDC), NEAR Foundation, Anthropic, AWS, Base, and Chainlink, with more joining over the following months. Though, September was record-breaking in terms of substantial collaborations.
First, Coinbase and Cloudflare officially announced the formation of the x402 Foundation, aimed at governing and advancing the x402 payment-protocol standard. Its mission is to make payments on the web truly “internet-native” (machine-to-machine, autonomous agents), and to encourage ecosystem adoption of x402 for AI agents, APIs, micropayments, etc.
Cloudflare is partnering with Coinbase to create the x402 Foundation and adding x402 support to the Agents SDK & MCP Servers.
The protocol translates between blockchains and HTTP, letting developers treat money as data. With Cloudflare and Google integrating x402, the protocol now has credible infrastructure support and a path to standardization. If this trajectory continues, x402 could become the Internet’s default settlement layer, the base payment primitive for agents, APIs, and services alike.
Later on, Google introduced its own Agent Payments Protocol (AP2) integrating x402 to allow AP2 agents to transact via stablecoins/crypto. In other words: AP2 defines the high-level framework (mandates, verifiable credentials, agent payment flows) and x402 provides one of the rails (especially for token/crypto-based micropayments) that plug into AP2 for autonomous agent commerce.
Called the Agent Payments Protocol (AP2), the system is meant to be interoperable between AI platforms, payment systems, and vendors.
Last but not least, Cloudflare announced the release of its USD-backed stablecoin NET Dollar that would leverage x402.
Cloudflare unveils NET Dollar, a US-backed stablecoin designed for AI agent transactions, enabling secure, instant, and global payments online.
As Messari states, the real innovation behind x402 isn’t just that payments now settle onchain.
It’s that x402 shifts the operational burden to a facilitator, a service layer that handles the technical work of verifying and settling transactions. A facilitator confirms that each payment meets the seller’s stated terms, submits it to the blockchain, and returns proof of settlement, all automatically and in real time. It doesn’t custody funds or touch user balances. Instead, it acts as a lightweight executor that ensures payments clear correctly without forcing servers to run blockchain nodes, manage wallets, or pay gas fees directly.
Coinbase Developer Platform (CDP) operates a hosted facilitator service, but an ecosystem of third-party facilitators is also slowly emerging. Each of them specializes in different developer languages, chains, or agent environments. Here's a list by Messari:
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Over the last couple of weeks, the x402 protocol experienced such an impressive growth that it got literally everyone on Crypto Twitter hyped and excited. As x402scan reports, in just 15 days, x402's number of transactions jumped by 6,200%, volume - by 5,900%, whereas buyers and sellers soared by 56,300% and 12,200%, respectively.
Initially run on Coinbase's Base chain, x402 now powers autonomous payments on all EVM chains, Solana, peaq, and others. What's more, the x402 ecosystem across core contributors, facilitators, infrastructure providers, and live agents grew exponentially (see below), as even CoinGecko unveiled a x402 category.
The excitement is understandable given that for the very first time in the history of the Internet, microtransactions and pay-per-use models are finally here.
As Renaud Partners' Gregor Frick, wrote: “The web as we know it was never designed for small, programmatic payments. Every online service today relies on subscriptions, accounts, and login management". x402, on the other hand, “allows you to pay automatically, per request, directly over HTTP: no subscriptions, no logins, no accounts. Think of it as a pay-per-use layer for the internet itself.”
But why now? What really provoked x402's sudden expansion?
At the beginning of October, Coinbase introduced a new system called Payments MCP (Model Context Protocol) that builds on x402 and lets AI agents hold wallets, fund them, and send stablecoin payments autonomously.
It creates a real connection between the most popular Large Language Models (LLMs), like GPT, Claude, and Gemini, and the crypto world.
Payments MCP's features include user-configurable spending limits for agent wallets, compliance and KYC built into the system, and the ability for agents to pay for APIs or services without human intervention.
The exchange's new tool connects large language models to crypto wallets, marking another step toward machine-to-machine commerce.
However, what's really been driving x402's spectacular progress are definitely the companies, both Web3 and Web2, that are integrating it. As Bankless comments:
Vercel, the leading developer platform with 6M users, has integrated x402, bringing the micropayment functionality to its massive builder community.
Anthropic, the creators of Claude, has enabled its models to discover, retrieve, and pay for context and tools using x402.
Freepik, a popular AI creative studio tool with 700K+ users, has adopted the standard for its design platform.
Daydreams has built an autonomous AI agent and app platform running on x402 payment rails across Base, Solana, and Starknet. Their Daydreams Router provides unified access to a multitude of AI models, enabling no-signup, pay-per-use inference with USDC micropayments. They've also launched the x402 Nanoservice, which lets developers deploy paid AI services with built-in micropayment functionality.
Without a doubt, one of the main engines behind x402's record-breaking all-time highs have been meme- and agent coins. Over the last few days, numerous key voices have been pointing up the large number of questionable and outright "shitcoins", riding the x402 train.
In fact, x402 has rekindled the memecoin craze with the so-called "HTTP-Native Fair Launches / Mints" or launchpads that allow memecoin generation and launches via x402. 0xJeff has explained what that means in practice:
Devs Drop URL ➙ Users instantly mint tokens via a simple web request ➙ Instantly receiving tokens on-chain.
Many of these will probably turn out to be purely speculative and quickly disappear, so be vigilant.
Indeed, the x402 protocol represents a true evolutionary jump in the way we exchange value over the Internet. The recent advancements made American Express' Philip Decker reimagine the credit card, so it could serve AI agents:
while aryan remodelled the digital ads economy through x402 browsers:
Despite all this, x402 is not enough to power a fully-fledged agent economy, at least not yet. 0xJeff writes:
In order to have a full agentic economy, you need auxiliary infrastructure, quality services, and trust/verifiability layer for the agents to understand who they can trust for the services.
You also need an entire commerce layer designed for pay-per-use, per-result, per-second which requires: Tracking what work was done; Calculates how much it costs; Settle it instantly; Make sure the agents who pay get the results; Attribute the high quality result to the right agents; Establishes the history of work/quality of services for the agents.
Fortunately, there's a x402 V2 in the works that will hopefully equip it to address new challenges. As Bankless clarifies:
The x402 hype is real, but the protocol isn't ready for prime time yet.
V2 will address the core technical friction holding it back: messy architecture that makes adding new features painful, web compatibility issues causing integration headaches, and clunky network interactions that frustrate users.
Why V2 is already in the works, tackling core issues around architecture, discovery, and user experience.
I'll keep following the latest developments around x402 and other payment protocols, so stay tuned!
Thank you for reading! The next edition is coming tomorrow.
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I'm looking forward to connecting with fellow Crypto x AI enthusiasts, so don't hesitate to reach out to me on social media.
Disclaimer: None of this should or could be considered financial advice. You should not take my words for granted, rather, do your own research (DYOR) and share your thoughts to create a fruitful discussion.
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Albena Kostova-Nikolova
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