How can an HTTP code forgotten for 30 years usher in a new era of AI payments?

An HTTP status code that had been gathering dust for almost thirty years was recently dug up by Coinbase to stir things up.

Starting with legacy code from 1997

The story goes back to 1997. That year, the HTTP protocol reserved a 402 status code, meaning “Payment Required”—you had to pay to access the resource. Sounds ahead of its time, right? Unfortunately, there was no reliable online payment method back then, so this status code just sat in the protocol documentation unused.

Fast forward to 2025. Crypto stablecoins have matured, Layer 2 solutions have cut transaction costs, and AI Agents have suddenly created real micropayment demand. Spotting the opportunity, Coinbase reactivated this “antique button” and launched the x402 protocol.

The core logic is straightforward: anyone or any AI wanting to access paid content doesn’t need to register an account or redirect to a payment page; they simply complete an on-chain transfer. It looks like a simple “auto-pay” feature, but in reality, it ties into an entire ecosystem that’s being rebuilt from the ground up.

So how does this ecosystem actually work? Beyond all the meme coins flying around, which protocols, chains, infrastructure, and applications are really doing the work? Let’s break it down.

Protocol Layer: Teaching AI How to Spend Money

The x402 protocol layer doesn’t stand alone; it’s a modular toolkit combo that solves three core problems: how AIs talk to each other, how they pay, and how they build trust.

At the base is the x402 protocol itself. It’s designed around the HTTP 402 status code, allowing AIs to automatically receive payment requests when accessing paid APIs or content, and then complete on-chain transfers with stablecoins like USDC. The whole process requires no human intervention and no account registration.

How do AIs collaborate? Google introduced the A2A protocol (Agent-to-Agent), standardizing communication and task handover between agents. Anthropic also launched the MCP protocol, providing AIs with tools and context data interfaces.

Building on MCP, Google released the AP2 payment protocol, enabling AI Agents to call services and pay automatically as needed, supporting both traditional payments and x402. Sound a bit complicated? Simply put, it’s like giving AIs an automated wallet and payment system.

To make these protocols work, the key is Ethereum’s EIP-3009 extension. It allows users to authorize token transfers via signatures without paying gas fees—solving the “AI wallet with no ETH” dilemma.

Complementing this is the upcoming ERC-8004, which establishes on-chain identity and reputation systems for AI Agents, recording execution history and trust scores. Service providers can use this data to judge whether an agent is reliable.

In summary, x402’s protocol layer is building a “language + currency + trust” system for AI. It enables AIs to transact, collaborate, and pay without human involvement. This is the first step to getting the whole ecosystem running.

Infrastructure Layer: Who’s Making Payments Actually Work?

Protocols define the rules, but what really makes it work is a whole set of infrastructure—verifying requests, completing payments, coordinating services, and connecting AIs to the on-chain world.

Cloudflare is a key player here. As a global cloud platform, it co-founded the x402 Foundation with Coinbase and integrated the protocol into its CDN nodes and developer tools. Cloudflare not only offers a global distribution network but also supports a “use resources first, pay later” delayed payment mechanism, helping AIs smoothly access and settle content.

Then there’s the x402 Facilitator—the payment aggregator. These projects help AI agents complete the series of on-chain processes: “paying on behalf, settlement, broadcasting.” Users or AIs just send an HTTP 402 request, and the Facilitator pays the gas, packages the transaction, and broadcasts it on-chain. Settlement uses the EIP-3009 standard, allowing one-time authorization for USDC deductions—no need for the AI to hold tokens or manually sign.

According to data, Coinbase is still the largest Facilitator, handling over 1.35 million transactions across 80,000 buyers. PayAI is second, active on Solana and Base, with $280,000 in total transaction volume and more users than Coinbase. Other players like X402rs, Thirdweb, and Open X402 are also competing for market share.

Beyond Facilitators, there are “native settlement blockchains” built specifically for x402. A representative project is Kite AI, one of the first Layer 1 blockchains to fully embed x402 payment primitives, supported by Coinbase Ventures, PayPal Ventures, and others. It doesn’t handle payment verification directly but provides an execution and settlement environment for x402 transactions, allowing agents to automatically initiate, receive, and reconcile on-chain payments via standardized authorization commands.

On the execution side, in addition to Kite AI, the DePIN project Peaq also plays a crucial role. Peaq is a public chain focused on the machine economy and has native x402 support, enabling automated payments and settlement between devices and agents.

The x402 collaboration layer is represented by Questflow, where developers can post agent tasks, set prices, and settle on-chain via x402. It already partners with platforms like Virtuals and Gate.

Other providers like AurraCloud and Meridian offer multi-chain settlement and custody services for the x402 protocol.

In short, x402’s infrastructure layer is being built around three core issues: how to send requests, how to collect payments securely, and how to quickly deploy across different chains. These factors determine whether the entire payment system can actually run.

Application Layer: Who’s Really Using x402?

With protocols and infrastructure in place, the focus moves to the application layer—are there any real-world projects? Right now, very few have landed.

• Daydreams: Building an LLM inference platform with x402 payments.
• Heurist Deep Research: A Web3-native AI research platform where users pay with USDC per query to automatically generate multi-page research reports.
• Gloria AI: Uses x402 to enable pay-per-article news.
• Snack Money API: A micropayment interface for platforms like X and Farcaster, focusing on identity and social tipping.
• tip.md: Lets AI assistants help users complete crypto tipping directly in chat, with USDC tips processed via MCP+x402.
• Firecrawl: A web scraping and cleaning API that turns websites into LLM-usable data and charges per call via x402.

Overall, x402’s application layer is still in the exploratory phase. Functional platforms are just starting, and scale effects haven’t emerged. It remains to be seen who can launch truly usable, paid, and reusable products first.

Meme Coins: Buzz Without Real Adoption

As x402’s concept heats up, a wave of native meme projects have quickly emerged to “ride the narrative.” The most representative is PING on the Base chain, which hit a market cap of over $10 million on its launch day.

Beyond PING, the community has seen tokens like “PENG” and “x402” appear. These meme coins aren’t core to the protocol but bring attention, hype, and early liquidity. Prices and popularity fluctuate wildly.

What Issues Must x402 Overcome to Achieve Real Adoption?

Despite the buzz, x402 still faces many practical challenges before it can truly take off.

First, a lack of truly usable products. Most projects are still at the testnet or proof-of-concept stage, with rough user experiences.

Second, a complex tech stack and high integration costs. x402 involves a new set of protocols, integrating payment, signature transfers, agent communication, and more—raising the bar for developers.

Third, compliance risks. Featuring “no account, no redirect payments,” it’s efficient but bypasses traditional KYC/AML requirements, which may face regulatory concerns in some regions.

Fourth, network effects have not yet formed. Payment protocols rely on ecosystem synergy, but there aren’t many x402-enabled services and platforms yet, so the ecosystem is not self-sustaining.

In short, x402 is still some distance from “mass adoption.” From tech to real-world use, several hurdles still need to be overcome.

Where Are the Participation Opportunities?

Looking from a participation angle, x402’s long-term opportunities lie more in infrastructure and key platform deployment.

First up is base chains and infrastructure. x402 depends on Ethereum standards like EIP-3009 and ERC-8004, and Base is currently the primary deployment chain, with a strong stablecoin loop and developer-friendly environment, poised to incubate leading products. Solana also has advantages for high-frequency payments, suitable for agent micropayment scenarios.

Next are native settlement blockchains like Kite AI, and payment aggregators and service platforms such as PayAI, Meridian, and AurraCloud. They handle payment verification, gas sponsorship, and API integration—once they become general gateways, their value will scale quickly.

As for tokens, caution is advised. Most x402-related tokens are small and volatile, with many meme coins still in the narrative-driven stage. Projects with real payment adoption or platform utility are more worthy of attention.

What Do Insiders Think?

With market opinion divided, many frontline builders and KOLs have shared their views on the x402 ecosystem.

Haotian pointed out that most of today’s x402 frenzy is driven by meme speculation, but the real “main course”—technological adoption and ecosystem formation—