Cloudflare and Coinbase Launch x402 Foundation for Machine-to-Machine Web Payments – Here’s How it Impacts You

Cloudflare and Coinbase are launching the x402 Foundation to establish a universal standard for AI-driven payments, enabling machines to pay for web resources without human intervention ￰0￱ protocol converts the HTTP “ 402 Payment Required ” error code into a functional payment system, enabling AI agents to purchase data, services, and content ￰1￱ Armstrong, Coinbase’s CEO, called x402 “ a big step forward ” that allows AI agents to “ transact value, not just exchange info .” We're launching the x402 Foundation with @Cloudflare . I’ve been thinking about how internet payments should work for ￰2￱ more specifically, how they aren't working, and need to improve.

x402 is a big step ￰3￱ agents can now transact value, not just exchange ￰4￱ — Brian Armstrong (@brian_armstrong) September 23, 2025 The protocol addresses a fundamental problem in the current payment systems, which were designed for humans clicking “buy” buttons, not machines making millions of automated ￰5￱ day, websites send over one billion HTTP 402 error codes to bots trying to access content, but these payment requests go unanswered because no standard exists for machines to ￰6￱ x402 protocol solves this by creating a common language for automated ￰7￱ initiative comes as Google recently announced similar stablecoin support for AI payments , partnering with Coinbase and the Ethereum Foundation.

Google’s James Tromans said stablecoins represent “ probably one of the most important payment upgrades since the SWIFT network .” Revolutionary Payment Flow Changes Everything for AI The x402 protocol creates a simple four-step process that transforms how machines handle payments ￰8￱ an AI agent tries to access restricted content, the server responds with payment instructions, including the amount and recipient ￰9￱ agent then sends the payment authorization header along with its request. A payment facilitator verifies the transaction and settles it automatically. Finally, the server delivers the content with confirmation that payment ￰10￱ system enables entirely new business models that were impossible with traditional payment ￰11￱ AI assistant could automatically buy Halloween costume accessories from multiple ￰12￱ trading bots could pay per request for real-time market data feeds, rather than monthly ￰13￱ is proposing a “ deferred payment scheme ” that allows batch settlements at the end of each day rather than immediate ￰14￱ approach accommodates crawlers that access thousands of pages before receiving a single aggregated bill through traditional payment methods or ￰15￱ protocol supports both immediate blockchain settlements and delayed payments through credit cards or bank ￰16￱ flexibility ensures compatibility with existing financial infrastructure while enabling the implementation of new automated ￰17￱ Infrastructure Powers Machine Economy Growth The timing coincides with explosive growth in stablecoin adoption for AI ￰18￱ to a report covered by Cryptonews in June, as of 2024, bots already account for 70% of stablecoin transfer volume, indicating machine-driven transactions are becoming ￰19￱ payment rails, such as wire transfers and credit cards, cannot handle the micropayments and instant settlements that AI agents ￰20￱ solve these limitations by providing programmable money that settles within seconds at minimal ￰21￱ stablecoin market has grown from $4 billion in 2020 to over $280 billion today, with monthly settlement volumes reaching $1.39 trillion in the first half of ￰22￱ stablecoin issuers now rank 17th globally in ￰23￱ ￰24￱ has created a live demonstration called the x402 playground , where visitors receive testnet USDC on the Base blockchain.