x402 resonates with technology, a new narrative is brewing.

Author: Trend Research

Recently, the emergence of $PING has driven the spread of the x402 concept, with two representative projects, $PING and $PAYAI, reaching highs of 75m and 70m respectively. Although due to weaker market liquidity, both have retraced to 30m and 20m, unlike pure meme narratives, x402 and its concept possess a certain degree of derivativeness and sustainability. The market still craves new narratives and opportunities for benefit, making the related narratives worthy of attention.

1. Why x402 is Worth Attention

2. The biggest pain point in the development of crypto is the lack of projects that solve real-world problems, resulting in a shortage of cash flow driven by genuine demand. x402 enters from the logic of internet-native payments, and against the backdrop of US stablecoins beginning to be adopted by large institutions, along with the further development of AI, it is expected to start forming real payment demand from a small scale.

3. The drivers and adopters behind x402 include Coinbase, Google, Cloudflare, Circle, Visa, and AWS, which itself has a large customer base and consumption scenarios.

4. x402 can create user-perceptible use cases on the product side, such as enabling payments through digital wallets without the need to add a bank card or perform KYC, and even allowing the AI Agent to complete an entire shopping process directly.

5. The further development of AI will inevitably create a demand for transactions and micropayments between machines, and blockchain may be the ultimate infrastructure for AI and machine interaction.

6. Deconstruct x402

402 is a status code “Payment Required” in HTTP that has been reserved but almost never used, x402 will optimize and enable it, and its structure is very simple, a picture is enough to illustrate.

A complete process for trading using the x402 protocol first involves four roles:

1. Client

The client refers to the party initiating the payment request. It can be any entity that needs to access a service or resource, such as an AI agent, user device, or application. The main responsibilities of the client are:

Initiate request: The client requests access to a certain resource or service.

Processing Payment: When the server returns a need for payment (HTTP 402), the client will sign the payment request and execute the payment. The client can use tools such as wallets to sign the transaction and provide payment authorization.

For example: An AI intelligent entity needs to obtain real-time market data from a data provider. It initiates a request as a client and will only receive the data after the payment is completed.

2. Server

A server is a provider of services or resources. Its main responsibilities are:

Return HTTP 402 response: When a client requests access to a resource and does not have valid payment information, the server will return an HTTP 402 status code, indicating that payment is required to continue access.

Verify payment and provide services: The server verifies the client's payment request to ensure that the payment has been completed. If the payment is successful, the server will process and return the requested data or service.

For example: An API service provider, upon receiving a client request, finds that no payment has been made, and thus returns an HTTP 402 response, requesting payment. After the payment is completed, the service provider will return the data or service to the client.

3. Facilitator

Facilitator refers to the role of acting as an intermediary in the payment process, usually a payment gateway or intermediate service, ensuring that payment requests are smoothly transmitted and ultimately completed. The main functions of the Facilitator are:

Coordinating payment requests and responses: It is responsible for handling payment interactions between the client and the server, ensuring that payment requests are correctly sent and forwarding payment information to the payment processor.

Transaction broadcast: The Facilitator may broadcast payment requests or transaction confirmations to the blockchain.

For example: In the payment process, the Facilitator could be a wallet application or a payment gateway that receives the client's payment request and broadcasts it to the blockchain for settlement after the transaction is processed.

4. Blockchain

Blockchain is the underlying technological foundation of the x402 process, used to ensure the security and transparency of transactions. The core responsibilities of blockchain include:

Ensure the immutability of payments: Once payment information is recorded on the blockchain, it cannot be modified or revoked, ensuring the authenticity and integrity of the transaction.

Provide a transparent settlement system: all transaction data is publicly available on the chain, allowing all parties to verify payment status.

Settlement and Transaction Processing: Once the Facilitator confirms the payment, the blockchain will process and ultimately settle the transaction, ensuring that funds flow from the client to the server provider.

For example: When the client completes the payment, the payment request will be transmitted to the blockchain through the Facilitator, ensuring that the funds of the payment flow between the correct addresses to complete the settlement.

A process:

① The client sends an HTTP request - the client sends a standard HTTP request to the resource server to access the protected endpoint.

② Server Response 402 — The resource server returns HTTP 402 Payment Required status code and provides payment details in the response body.

③ The customer creates a payment - The customer checks the payment requirements and uses their wallet to create the payment payload according to the specified scheme.

④ The customer resubmits the payment - The customer sends the same HTTP request again, this time including the header with the X-PAYMENT signed payment payload.

⑤ Server validates payment - The resource server verifies the payment payload as follows:

Local (if they run their own validation)

Through intermediary services (recommendation)

⑥ Payment Service Provider Verification - If a payment service provider is used, it will check the payment according to the scheme and network requirements and return a verification response.

⑦ The server processes the request — — If the payment is valid, the server will complete the original request. If the payment is invalid, another 402 response will be returned.

⑧ Payment Settlement — — There are two ways for the server to initiate blockchain settlement:

Directly submitted to the blockchain

Through the coordinator's /settle endpoint

⑨ Payment processor submits on-chain transaction - The payment processor broadcasts the transaction to the blockchain according to the payment network and waits for confirmation.

⑩ Settlement Confirmation - Once confirmed on the chain, the settlement party will return the payment execution response.

⑪ Server Delivery Resources - Server returns response, content as follows:

Respond to the requested resource in the body of the response.

X-PAYMENT-RESPONSE includes the title of the settlement details

In simple terms, x402 is an open payment standard that eliminates traditional barriers such as API Keys, subscription models, and manual settlements, achieving an efficient and frictionless payment system, particularly suitable for machine-to-machine (M2M) or AI-driven application scenarios.

3. The narrative is brewing.

Understanding the structure, it is not difficult to see that the emergence of new Crypto projects may revolve around Client, server, Facilitator, Blockchain, and transaction processes. Currently, most servers are mainly provided by existing web2 resource providers, while Client has been hyped during the recent wave of AI agents but lacks real regular demand. Recently, the focus has been on Ping( surrounding transaction processes), PayAI Network (Facilitator), and Kite AI (Blockchain).

1. Ping

Ping is the first token minted/distributed using the x402 protocol, and the market compares it to inscriptions because when users send USDC to a specific address on the Base chain, it is just a regular ERC-20 transfer. The project party acts as an “indexer” through x402scan, giving it off-chain meaning. “Sending USDC to a designated address via the x402 protocol is minting, which credits the address that initiated the transaction.”

Although Ping itself does not have much practical demand significance, the chosen angle is very clever. Currently, it is similar to the x402 concept meme coin, the first “billboard” that breaks the circle.

2. PayAI Network

Positioning myself as x402 Facilitator (matching/ acquiring/ validating/ settlement layer), focusing on Solana first, multi-chain, with practical use cases compared to Ping, similar ones include Daydreams, OpenX402, etc., the core is still the Facilitator provided by Coinbase itself.

3. Kite AI3. Kite AI

Positioned as the “first public blockchain for AI payments”, the goal is to embed the x402 payment primitives “into the underlying layer”, focusing on settlement/reconciliation/intention execution between Agent and Service. The x402 serves as an interoperability layer: Agents initiate payments through standardized intention/authorization envelopes, while service providers verify terms and settle; it natively supports reconciliation, peer instructions, batch aggregation, and other payment primitives. The roster of investors is impressive, including PayPal Ventures, Coinbase Ventures, Hashed, Samsung Next, HashKey Capital, and others.

Looking back, traditional companies like Coinbase started launching x402 as early as May, and it is still under accelerated development. Coinbase CEO Brian Armstrong stated on November 2, “x402 will allow stablecoin payments to be attached to any web request, which will become an important part of the new internet.”

Currently:

1. Visa supports the x402 standard, participates in support and standardization, and promotes the development of x402 in traditional payment networks, which is seen as a signal for future large-scale adoption.

2. Cloudflare and Coinbase jointly established the x402 Foundation to provide technical support and expansion proposals.

3. Anthropic supports the x402 protocol for AI and infrastructure payments.

4. Circle development integration tools, combining USDC and wallets with x402.

5. Google lays out the x402 protocol, participating in related investment and development opportunities.

6. AWS supports the x402 protocol for AI and infrastructure payments.

Although the enthusiasm for the x402 concept project has cooled down, this brief market trend has highlighted the demand for technological micro-innovations and real use cases.

On one hand, there is the underlying technology development and self-adoption by traditional technology and financial companies; on the other hand, there is the successive emergence of crypto projects, and the new narrative about AI and payments is visibly heating up.