x402: The HTTPS for Value, Reshaping Digital Transactions

Coinbase and Cloudflare have launched the x402 Foundation, a collaborative initiative aimed at standardizing machine-to-machine payments over the internet using the HTTP 402 "Payment Required" status code. The x402 protocol, developed by Coinbase, embeds stablecoin transactions directly into web interactions, enabling APIs, AI agents, and applications to exchange value seamlessly. This innovation addresses longstanding inefficiencies in traditional payment systems, which are often slow, geographically constrained, and incompatible with automated workflows. By leveraging HTTP’s existing infrastructure, x402 allows developers to monetize digital resources without relying on centralized platforms, subscriptions, or complex authentication mechanismsCloudflare. (2025). Launching the x402 Foundation with Coinbase, and support for x402 transactions.^[1].

The x402 protocol operates through a structured transaction flow. When a client requests a resource protected by x402, the server responds with a 402 Payment Required code and specifies payment terms, such as amount and acceptable tokens. The client then sends a signed payment payload via an HTTP header, which is validated by a payment facilitator before the server delivers the requested content. This process eliminates intermediaries and streamlines transactions, making micropayments and real-time settlements feasible for AI agents, autonomous systems, and developersCoinbase. (2025). Introducing x402: a new standard for internet-native payments.^[2]. For example, an AI agent could dynamically pay for cloud computing resources or real-time data feeds without human intervention, while content creators could monetize individual articles or API callsMorningstar. (2025). Cloudflare and Coinbase Will Launch x402 Foundation.^[3].

A key component of x402 is its deferred payment scheme, introduced by Cloudflare to accommodate use cases requiring delayed settlements. This model allows servers to decouple cryptographic verification from payment finalization, enabling batch processing, licensing agreements, or subscription models. For instance, web crawlers participating in Cloudflare’s "pay per crawl" beta can accumulate usage data over time and settle payments via credit cards or stablecoins at the end of a billing cycleCloudflare. (2025). Launching the x402 Foundation with Coinbase, and support for x402 transactions.^[1]. This flexibility supports diverse economic models while maintaining compatibility with both traditional financial systems and blockchain-based railsMEXC. (2025). Coinbase and Cloudflare will collaborate to establish the x402 Foundation.^[4].

The x402 Foundation, co-founded by Coinbase and Cloudflare, aims to establish the protocol as an open, neutral standard for internet-native commerce. Matthew Prince, CEO of Cloudflare, emphasized that x402’s design aligns with the internet’s core principles of decentralization and interoperability, positioning it as a potential cornerstone for agentic commerce. The foundation will focus on governance, ecosystem development, and ensuring cross-platform compatibility. Early partners include AWS, Anthropic, Circle, and NEAR, which see x402 as a tool to accelerate adoption of programmable, AI-driven economic interactionsMorningstar. (2025). Cloudflare and Coinbase Will Launch x402 Foundation.^[3].

Industry experts highlight x402’s potential to redefine digital transactions. Erik Reppel, Coinbase’s engineering lead for the project, compared the protocol’s significance to HTTPS, predicting it could enable a new era where value moves as freely as information. Applications range from AI agents autonomously purchasing cloud infrastructure to developers monetizing APIs with frictionless micropayments. Circle’s Gagan Mac noted that x402 simplifies real-time monetization by removing barriers like account registration, while NEAR’s Illia Polosukhin described its synergy with cross-chain settlements for agent-driven commerceCoinbase. (2025). Introducing x402: a new standard for internet-native payments.^[2].

Critics and competitors, including traditional payment processors like Visa and Stripe, are responding with AI-integrated solutions to retain relevance. However, x402’s open protocol model contrasts with platform-centric approaches, offering developers greater flexibility to embed payments directly into their applications. The protocol’s agnosticism to payment rails—supporting both stablecoins and traditional methods—further broadens its appeal. As adoption grows, x402 could challenge existing payment ecosystems, particularly in markets where micropayments and AI automation are gaining tractionBitcoin Ethereum News. (2025). Coinbase revives forgotten internet standard with x402.^[5].

The x402 Foundation plans to expand its ecosystem through developer grants, tooling, and partnerships. Coinbase and Cloudflare have already integrated x402 into their platforms, including Cloudflare’s Agents SDK and MCP servers, and Coinbase’s x402 Facilitator service. With the protocol’s open-source nature, developers can begin experimenting with x402 today, potentially accelerating its adoption across sectors like healthcare, finance, and decentralized applicationsCloudflare. (2025). Launching the x402 Foundation with Coinbase, and support for x402 transactions.^[1].