Author: FinTax

Introduction

The rapid development of artificial intelligence and autonomous systems is reshaping the internet economy, but one of the main obstacles to achieving fully autonomous AI systems is the lack of payment systems that enable AI agents to operate without human intervention. In May 2025, Coinbase launched x402, allowing APIs and AI agents to conduct transactions seamlessly, facilitating a more efficient, frictionless, and scalable digital economy. In October, the adoption rate of x402 exploded, processing nearly 500,000 transactions between October 14 and 20, a 10,780% increase compared to the previous four weeks, and facilitating over 932,000 transactions from October 21 to 27, a 34,300% increase, with momentum continuing.

x402 features seamless, fine-grained, and open characteristics, posing new challenges to traditional fiscal logic. Tax authorities urgently need to transform their tax collection models, utilizing new tax administration tools and enhancing international cooperation to implement effective tax administration for transactions under x402. This article analyzes the challenges posed by x402 to traditional fiscal logic based on its logic and characteristics and proposes fiscal solutions for x402.

1. Overview of x402

x402 is an open payment protocol created by Coinbase that embeds payment functionality directly into the web structure, reactivating the HTTP 402 (Payment Required) status code to achieve an internet-native, machine-friendly transaction model.

1.1 Framework of x402

Similar to the well-known HTTP 404 (Not Found), HTTP 402 is also a code for internet request and response interactions. When the HTTP standard was initially established, designers anticipated that paid resource acquisition would become an important part of the internet in the future and reserved the HTTP 402 status code for future payment mechanisms. The idea is that the server can respond to requests with "Payment must be made before this resource can be provided." In today's era of automation and flourishing AI, HTTP 402, a code forgotten for over thirty years, has sparked a new wave in the field of crypto AI.

Based on the HTTP 402 status code, x402 forms a simple and efficient payment framework, with the overall process being: the buyer requests resources from the server → [HTTP 402 Response] If payment is required, the server will return the HTTP 402 status code along with payment instructions → [Cryptographic Signature Authorization] The buyer prepares and submits the payment payload → [On-chain Settlement] The server uses the x402 coordinator's /verify and /settle endpoints to validate and settle the payment → If the payment is valid, the server will provide the requested content. x402 makes the payment process as natural as loading a webpage.

1.2 Advantages and Risks of x402

x402 has seamless, fine-grained, and open characteristics. Compared to traditional online payment models, x402 enhances user payment convenience by stitching together the payment and resource delivery processes, eliminating the need for human intervention, reducing transaction costs, and enabling micro-payments and autonomous AI agent transactions. At the same time, x402 supports any stablecoin, digital asset, or blockchain, offering great flexibility.

x402 maintains native web compatibility and is easy to integrate into any HTTP-based service. Video streaming services can utilize x402 to charge based on the seconds of content viewed, replacing traditional subscription-based profit models. Trading AIs can retrieve real-time stock market data for a fee of $0.02 per request. News websites and research platforms can charge ordinary readers $0.25 per article, allowing on-demand payment access instead of mandatory monthly subscriptions. x402 provides an alternative payment solution, offering a brand new toolkit for monetizing web services.

x402 is still in its early stages and is gradually being developed into a complete ecosystem. Meanwhile, the security risks associated with the rapid expansion of x402 are also worth noting. Some opinions point out that x402 tokens have issues such as excessive developer permissions and signature replay vulnerabilities, where attackers may exploit old authorizations to steal funds from wallets. The surge in illegal cross-chain crypto activities poses significant risks for combating crime and tax tracking.

2. Challenges of x402 to Traditional Fiscal Logic

Traditional online payments rely on external systems such as credit cards, bank networks, or platform-specific payment processors, which are cumbersome, costly, geographically restricted, and require multiple layers of manual authorization, making them unsuitable for AI-driven transactions. x402 eliminates these barriers by embedding on-demand payment, instant transaction completion, and AI-native tokenization (allowing AI agents and human users to pay dynamically without prior approval or API keys) into the web structure. The characteristics that transcend traditional payment methods bring advantages to x402 while also posing new challenges to traditional fiscal logic.

2.1 Absence of Trusted Third Parties in Seamless Transactions

Traditional payment channels typically use an account model, where both parties in a transaction need to establish a certain level of trust with the involvement of regulated financial institutions, making intermediaries such as banks or payment service providers key nodes for fund clearing and information recording. x402 reduces the intermediary role by enabling on-chain peer-to-peer settlement, weakening the long-standing influence of intermediaries.

The existing tax system heavily relies on intermediaries as trusted compliance nodes. On one hand, intermediaries bear part of the reporting obligations, such as banks providing cash flow records based on KYC, and payment processing institutions reporting merchant settlement data. On the other hand, intermediaries assist in tax tracking by verifying identities to trace taxable events.

The x402 model, due to its isolation from third-party intermediaries, loses standardized financial records such as bank statements and payment processing institution ledgers, which serve as verifiable evidence. In x402, the only objective record is the transaction hash on the blockchain. Although the blockchain is public, transparent, and immutable, the lack of mandatory identity binding and transaction reporting obligations, combined with the technical complexity of smart contract structures and transaction paths, significantly raises the threshold for tax authorities to identify taxable moments and reconstruct the real transaction chain. Therefore, tax declarations under x402 primarily rely on self-reporting by taxpayers, supplemented by limited on-chain analysis and risk screening, which increases the difficulty for tax authorities to identify hidden income and unreported earnings.

2.2 Fragmentation Risks from Micro-Payments and Autonomous Machine Transactions

x402 supports micro-payments and autonomous AI agent transactions, which may involve multiple blockchains and asset types, further highlighting the issue of fragmented taxable events. Most jurisdictions treat each asset disposal as a taxable event, meaning that even high-frequency API calls will create independent on-chain transactions based on each x402 payment, potentially being recognized as separate taxable events. Additionally, x402 may lead to the separation of tax evidence based on transaction timing, blockchain, and asset types, further contributing to the fragmentation of tax evidence on the basis of fragmented taxable events. Without adjusting existing taxation logic, x402 could lead to a multiplication of taxable events and significantly increase the technical difficulty of tax administration.

2.3 Taxpayer Identification Challenges in Multi-Chain and Multi-Asset Environments

x402 supports any stablecoin, digital asset, or blockchain. The openness of x402 to various blockchains and crypto assets amplifies the challenges that blockchain and crypto assets pose to traditional fiscal logic. These challenges manifest specifically in tax jurisdiction issues under borderless transactions and tax tracking issues under payment anonymity.

Regarding tax jurisdiction issues under borderless transactions, the principle of location is an important basis for the existing tax system to determine the taxpayer's tax location and tax jurisdiction. However, multi-chain settlements under x402 involve multiple economic activity locations, which may lead to an inability to identify the tax location. This makes it difficult to delineate the tax attribution of transactions, potentially resulting in tax overlaps and tax vacuums.

As for tax tracking issues under payment anonymity, the anonymity under x402 is not merely the anonymity of encryption but is generated from a structural and automated anonymity based on multi-chain, programmable, and decentralized settlement standards. Factors such as x402's AI-driven routing, self-custody identity layer, and off-chain metadata storage collectively enhance information privacy protection, weakening tax authorities' ability to obtain complete transaction information through traditional financial intermediaries and centralized platforms, posing a substantial challenge to the third-party reporting-centric tax administration model.

3. Fiscal Solutions for x402

To address the challenges posed by x402, tax administration needs to keep pace with x402 and implement effective regulation based on its seamless, fine-grained, and open characteristics.

3.1 New Anchor Points for Taxpayer Information Acquisition

x402 simplifies the payment process, weakening the pivotal role of traditional banks and payment institutions in the tax information chain. To maintain the availability and reliability of taxpayer information, tax authorities need to establish new information "anchor points" and trust mechanisms within the x402 system.

One possible approach is to embed standardized tax metadata into x402, incorporating tax regulation into the seamless structure of x402, requiring that x402 payment requests and payment proofs include structured fields such as merchant VAT numbers, invoice numbers, and payer tax ID hash values to ensure the reliability and traceability of tax information, establishing anchor points for taxpayer identification.

Additionally, from the perspective of keeping the core x402 protocol lightweight, external paths for acquiring tax information can be explored: without altering the core settlement logic, structured tax data can be carried by ancillary documents or parallel data channels and cryptographically linked to specific x402 transactions via hash values, thereby expanding tax information functionality in a "sidecar" manner.

3.2 New Approaches to Taxable Event Management

In managing taxable events, given that x402 may lead to a significant increase in the number of taxable events, tax authorities need to consider adjusting existing collection models and gradually introducing corresponding collection tools.

In terms of collection models, in the case of highly fragmented taxable events, continuing to tax each transaction individually would lead to excessive compliance and management costs. Tax authorities can explore net settlement or periodic batch taxation models, summarizing taxable events generated in micro-payment scenarios on a monthly or quarterly basis. Specifically, a tax settlement layer can be designed above the x402 payment layer to aggregate and classify original transaction events based on tax jurisdiction, tax type, and other dimensions, calculating the taxable net amount for each tax period. Compared to individual reporting, this model is expected to alleviate the reporting burden on taxpayers and tax authorities while ensuring tax neutrality and fairness, thereby reducing collection costs.

In terms of collection tools, the role of data analysis tools such as artificial intelligence can be further leveraged to automate the identification and risk monitoring of high-frequency, fragmented transactions. On one hand, machine learning techniques can be used to cluster and classify different transaction patterns, assisting tax authorities in understanding new taxable behaviors under x402; on the other hand, segments that may constitute taxable events can be automatically extracted from continuous transaction flows to generate pre-filled tax reports for tax personnel to conduct sampling and review.

3.3 Strengthening International Cooperation to Form New Rules

In terms of coordinating tax jurisdiction, under the highly cross-border and de-territorialized context of x402 transactions, different jurisdictions may have divergent understandings and applications of tax ownership rules. To reduce double taxation and tax vacuums, it is necessary to strengthen communication and cooperation through international organizations and bilateral or multilateral arrangements, forming a set of basic principles for tax jurisdiction and conflict resolution mechanisms applicable to x402 scenarios. This should provide a unified framework for the tax jurisdiction of transactions under x402 while respecting the differences in national tax systems, clearly defining tax attribution. Additionally, in the context of fragmented tax data, it is essential to explore the establishment of cross-border tax information sharing arrangements related to x402, supporting cross-border tracking and reconciliation while complying with legal confidentiality and data protection requirements.

For targeted tax administration of x402, the key lies in fully understanding the technical logic of x402 and, based on this understanding, moderately transforming its programmable elements into regulatory tools. To achieve a balance between payment innovation and tax administration, an ideal approach would be to integrate some tax identification, reporting, and information recording functions into the x402 structure through standardized interfaces or modules, enabling the payment process, business content response, and tax collection to be technically interconnected as much as possible, while reserving embedded space for fiscal compliance at the protocol layer.

4. Conclusion

x402 creates a new paradigm for internet-native payments, and its seamless, fine-grained, and open characteristics rewrite traditional fiscal logic while also bringing numerous challenges such as opacity in fiscal information and fragmentation of tax data. Tax authorities urgently need to keep pace with industry developments, proactively laying out a new system for tax administration and compliance driven by artificial intelligence and x402, ensuring tax security.

免责声明：本文章仅代表作者个人观点，不代表本平台的立场和观点。本文章仅供信息分享，不构成对任何人的任何投资建议。用户与作者之间的任何争议，与本平台无关。如网页中刊载的文章或图片涉及侵权，请提供相关的权利证明和身份证明发送邮件到support@aicoin.com，本平台相关工作人员将会进行核查。