x402 may not remain in the hype phase for long, but is expected to quickly transition to the infrastructure phase.
Author: 100y.eth
Translation: Deep Tide TechFlow
Key Points:
In the crypto industry, most new concepts typically go through three phases: hype, infrastructure development, and adoption. However, most projects fail to successfully transition from the hype phase to the infrastructure phase, losing market attention.
x402 is a protocol developed by Coinbase, specifically designed for AI agent payments. It enables AI agents to easily complete payments and access paid resources via the blockchain without human intervention.
From the recent surge in tokens related to x402, it appears that the protocol has entered the hype phase. However, what sets x402 apart from other typical crypto topics is that large companies like Cloudflare, Google Cloud, and Anthropic are actively adopting this technology, indicating that its infrastructure phase is rapidly advancing.
Considering the potential of agentic commerce, x402 is expected to successfully enter the adoption phase. However, its bottleneck lies in changing consumer psychology and trust structures. According to research by Accenture, the biggest barrier to the widespread adoption of agentic commerce is consumers' lack of trust in AI agents.
Nevertheless, Gartner predicts that by 2030, the transaction volume controlled by AI agents will reach $30 trillion. Agentic commerce will thus become an enormous market that is inevitable for the future. This will also mark a key moment for blockchain to find its second global product-market fit (PMF) after stablecoins.
Hype, Infrastructure, and Adoption Cycle
From New Concepts to Widespread Application
The crypto industry is a rapidly changing field. The rise and fall cycles of new concepts can often be as short as a few months, with their attention peaks and declines being more extreme than in other industries. Overall, keywords like NFT, gaming, metaverse, and modular blockchains have all experienced similar cycles; locally, concepts like "futarchy" that have recently emerged also briefly attracted market attention before quickly disappearing.
Due to the constant emergence of numerous new concepts in the crypto industry, meaningful adoption requires overcoming many obstacles. I categorize this process into three stages:
Hype Phase: This is the stage where a new concept first attracts widespread attention. During this phase, existing projects slightly related to the concept, newly launched small projects, and related meme coins often see price increases of dozens or even hundreds of percentage points. If the concept successfully transitions to the next phase, its price may stabilize, but in most cases, the price will crash within weeks or months, and related projects will disappear.
Infrastructure Phase: Once the potential and relevance of a new concept are proven, developers begin to build meaningful products based on it. Product development takes a long time—ranging from several months to over a year—so vague or meaningless concepts often die out in this phase. However, if the concept truly has value, it will maintain stable attention in this phase, create practical application scenarios, and gradually drive growth in the entire field.
Adoption Phase: If a concept reaches this stage, congratulations! In the crypto industry, only a very few concepts successfully enter the adoption phase, such as automated market makers (AMMs), centralized limit order books (CLOBs), lending protocols, staking-related protocols, and stablecoins. Concepts in this phase have proven their product-market fit (PMF), leading to the continuous emergence of new protocols and attracting a large number of users to actively participate.
Case Analysis in the Crypto Industry
So, what stage are the currently popular topics on Crypto Twitter (CT) in?
Futarchy: As mentioned, futarchy entered a hype phase due to Vitalik's mention, but then the heat faded. Recently, with the Solana ICO platform, the topic has entered the hype phase again. However, just a few weeks later, it quickly lost attention. The reason is that futarchy involves an extremely large governance discussion, making it a concept that is difficult to achieve widespread adoption without social generational changes.
Decentralized Energy: Decentralized energy entered the hype phase last year when many companies received investments from top-tier VCs. Recently, Daylight received $75 million in investment from Framework and a16zcrypto, temporarily sparking new hype. However, market interest did not sustain. The reason is that, as a field requiring physical infrastructure support, the infrastructure phase of decentralized energy will inevitably take a long time.
Robotics: Robotics also follows a similar pattern. As the combination of crypto and artificial intelligence (AI) gained attention, the project Openmind, which combines crypto and robotics, raised $20 million from institutions like Pantera, igniting market interest in the robotics field. Many small and medium-sized projects and meme coins saw their prices soar, but it will still take time to reach the adoption phase. However, considering the enormous potential of the combination of crypto and robotics, many developers, including Openmind, are actively developing related products.
From these cases, the path for new concepts in the crypto industry from inception to adoption seems extremely challenging.
However, a recently popular concept on Crypto Twitter called x402 appears to have the potential to quickly enter the adoption phase. So, what makes x402 different?
Can x402 Succeed?
Overview of x402
x402 is an open payment protocol developed by Coinbase, designed to enable artificial intelligence (AI) agents to autonomously complete payments and transactions without human intervention. x402 allows AI agents to use stablecoins to pay across multiple blockchain payment services and offers the advantage of instant settlement, avoiding complex processes like account creation, subscriptions, or API keys.
Source: Coinbase
HTTP 402 is a status code indicating "Payment Required," but it has been rarely used for a long time. x402 leverages HTTP 402 so that when an AI agent sends an API request, the server returns an HTTP 402 status code indicating that payment is required. Upon receiving this response, the AI agent pays the required amount in stablecoins. The specific process is as follows:
When the AI agent attempts to access a paid service (such as a news article, API, or data), the server returns an HTTP 402 Payment Required status code. This response not only indicates "payment required" but also includes information such as payment method, payment amount, and recipient (wallet address).
Based on the information provided by the server, the AI agent generates a transaction for the specified amount, adds a digital signature, and sends it back to the server.
The server passes the payment information to a "Facilitator," which verifies the payment and processes the transaction on the blockchain.
Once the payment is completed, the server grants the AI agent access to the service.
The significance of x402 lies not only in providing a payment standard for AI agents. Since payments are made using stablecoins on the blockchain, it enables micro-payment functionalities that were previously unattainable, allowing AI agents to call APIs or pay for services in real-time based on usage. Additionally, x402 allows human users to bypass complex processes like API key management or account creation to access content directly based on micro-payments.
2.2 Hype Phase
Source: a16zcrypto
x402 was first launched in May 2025, initially receiving limited attention. However, after being mentioned in a16zcrypto's report titled "State of Crypto 2025: The Year Crypto Went Mainstream," x402 began to gain significant attention. According to Gartner data, the agentic commerce market is expected to reach $30 trillion by 2030, and a16z noted that x402 could become the primary payment channel for AI agents.
The most obvious sign that x402 has entered the hype phase is the sharp rise in the prices of related tokens. For example, the token $VIRTUAL, which reacts whenever the AI agent topic resurfaces, surged 40% within just two days, and other related tokens also saw significant price increases, as shown in the chart below.
This makes x402 appear to be another typical crypto concept—hollow, superficial, driven solely by hype. Indeed, many new crypto concepts emerge in a similar manner: causing small projects and meme coins to skyrocket in price before quickly disappearing.
However, what sets x402 apart from other topics is:
The high relevance of AI agent payments: This concept is not only significant in the crypto field but also attracts considerable attention in the broader AI industry, giving it enormous potential.
Numerous Web2 companies actively focusing on and adopting it: These factors indicate that x402 may not remain in the hype phase for long, but is expected to quickly transition to the infrastructure phase.
Infrastructure Phase
Currently, x402 is in both the hype phase and the infrastructure phase. In fact, even before x402 entered the hype phase, many Web2 and Web3 companies had already begun building infrastructure for x402 and actively integrating it into their services. Therefore, it is more accurate to say that x402's starting point is the infrastructure phase.
Interestingly, unlike typical crypto narratives, x402 has attracted the attention of numerous large Web2 tech companies, and these companies are actively adopting this protocol. This phenomenon that crosses the boundaries of Web2 and Web3 makes x402 particularly unique in the crypto industry.
Cloudflare
Cloudflare is a company that provides internet infrastructure and security solutions. Recently, the company launched the "Agents SDK" service to help developers easily create and deploy AI agents, as well as "Workers AI," an environment for running AI model inference.
Cloudflare co-founded the x402 Foundation with Coinbase and is very active in the x402 ecosystem. Cloudflare supports x402 in its "Agents SDK" service, enabling AI agents to easily make online payments.
Notably, Cloudflare recently launched a dollar stablecoin called NET Dollar, designed specifically for AI agents. AI agents built using the "Agents SDK" are expected to use x402 and NET Dollar for agentic commerce activities.
Vercel
Vercel is a cloud platform company aimed at helping developers quickly build and deploy web applications. Vercel recently launched services like "Vercel AI SDK" and "Vercel MCP," enabling developers to easily build and deploy AI agents and access projects through MCP.
In September of this year, Vercel released x402-mcp, allowing AI agents to automatically handle payment transactions when accessing paid APIs or resources through MCP.
Google Cloud
Google Cloud previously launched the A2A protocol, which enables AI agents to communicate and collaborate with each other. The A2A protocol includes an extended feature called AP2 (Agentic Payments Protocol), allowing agents to autonomously complete payments. x402 is integrated into this system as the payment engine for AI agents to conduct actual transactions.
Anthropic
Anthropic is a well-known artificial intelligence company whose Claude LLM supports users in building AI agent services. Anthropic also launched an open-source standard protocol called MCP, which defines how AI models access external tools and data. Claude MCP supports x402, allowing Claude to automatically handle payment transactions when accessing paid MCP tools.
Visa
As the world's largest card payment network, Visa recently announced the launch of the "Trusted Agent Protocol," developed jointly by Visa and Cloudflare. This protocol is used to verify whether the requests made by AI agents in agentic commerce activities are trustworthy and supports payments through x402.
Others
According to Coinbase's announcement, other companies such as Circle and AWS are also collaborating with x402.
In addition to companies and protocols adopting x402, several developer-friendly tools have recently emerged, such as x402scan. This exploration tool visualizes the servers, transactions, and payment processes using x402, allowing users to see which services are making payments through which payment intermediaries and on which networks.
As the x402 ecosystem continues to expand, more companies and tools are expected to join, further enriching and developing the entire ecosystem.
Can x402 Enter the Adoption Phase?
3.1 Challenges to Entering the Adoption Phase
Source: x402scan
From the sharp rise in related token prices and the adoption of x402 by numerous large companies, it seems that x402 has entered both the hype and infrastructure phases. However, whether x402 can step into the adoption phase remains an open question.
According to data from x402scan, approximately 55,000 buyers have sent 879,000 transactions to about 1,000 sellers. These numbers look impressive, but the total transaction volume is only about $923,000. This indicates that x402 still has a long way to go before entering the adoption phase.
Conditions for Entering the Adoption Phase
What conditions must x402 meet to enter the adoption phase? One of the most frequently mentioned factors is consumer psychology and trust structures. Even for someone like me who writes about x402, I can accept AI agents' recommendations in business, but I still hesitate to fully trust them with my funds.
Even the latest LLMs (large language models) sometimes provide incorrect information or less-than-ideal answers, making it psychologically difficult for consumers to trust AI agents based on these models to handle payment transactions. In fact, according to an Accenture survey of financial institutions, 87% of respondents believe that customer distrust in AI payments is an issue, and 78% express concerns about AI robots making unauthorized payments or participating in fraud.
The second factor is the current state of enterprise infrastructure. According to Accenture data, 85% of financial institutions report that their existing traditional systems are not suitable for handling large-scale agent payments. In particular, the lack of systems to address fraudulent transactions in agent payments is one of the main barriers to entering this field.
Overall, for x402 to enter the adoption phase, companies need to build systems optimized for agentic commerce and cultivate consumer trust in these systems. However, both developing such infrastructure and changing consumer psychology will require a significant amount of time, so x402 may take longer than expected to reach the adoption phase.
What Does This Mean for the Blockchain Industry?
According to Gartner's predictions, by 2030, AI agents will influence $30 trillion in purchasing behavior. While the AI agent payment market is still in its early stages, it is encouraging that x402 seems to be establishing its position as an industry standard. This aligns with the fact that major IT companies like Google, Anthropic, and Cloudflare are adopting x402 for AI agent payments.
So, what can the crypto market expect as x402 becomes more active? A highly likely prediction is that the recent surge in token prices related to x402 may be difficult to sustain in the long term. Since the rise of crypto and AI, this concept has gradually evolved into a meaningful field, giving rise to multiple new projects, but many small project tokens and meme tokens that soared during the initial hype phase have shown disappointing price performance over time.
Source: x402scan
A clear added value that x402 brings to the blockchain industry is that all AI agent payments will occur on blockchain networks. Currently, most transactions take place on the Base network, with some occurring on Solana, but x402 is designed to be blockchain-agnostic, meaning it can be used on any network. This indicates that as the x402 ecosystem expands, payments will occur across multiple networks—not just Base and Solana, but driven by the demands and supplies of buyers and sellers.
Agentic commerce represents an inevitable and enormous market for the future, and all payments will ultimately flow through x402 on the blockchain. This will mark the moment when blockchain finds its second global product-market fit (PMF) after stablecoins.
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