x402 may become the next trend.

Author: David Hoffman Source: Bankless Translation: Shan Ouba, Golden Finance

This week, I recorded a highly valuable podcast with the founder of Merit Systems. After finishing, I am convinced that x402 may become the next big trend.

x402 is the intersection of artificial intelligence and cryptocurrency, where the two combine to create real value. Through x402, intelligent agents can act as “first-class citizens” of the internet to complete transactions, while also providing new opportunities for developers to create products and services that meet the resource purchasing needs of intelligent agents.

x402 Development History

In the early 1990s, pioneers of the internet reserved the HTTP 402 status code (meaning “Payment Required”) when defining network architecture, aimed at paving the way for a future model of “server charging per request.”

The problem at the time was that the online payment system had not yet emerged.

Credit cards and bank transfers are not suitable tools for this model — the transaction fees are too high, and the information involved is too sensitive — therefore, the 402 status code has remained idle. Against this backdrop, the default internet business model shifts towards advertising and subscription rather than pay-per-request.

But by 2025, technologies such as stablecoins, finality of instant transactions, non-refundable mechanisms, and sub-second blockchain confirmation times have matured. These features perfectly align with the x402 model, making internet-native commerce a reality.

Popularization of x402 is beneficial for internet development

For a long time, the internet has been constrained by the lack of a native commercial system, forcing people to awkwardly integrate traditional banking practices into this highly adversarial environment. How many times have you entered your credit card number on various websites in your lifetime? How many times have you logged in using tools like Plaid or PayPal? And how many times have you reset your password in such scenarios?

It is precisely because of this that the absence of a small payment system has left a gap in the market, which advertising just happens to fill - thus giving rise to the “advertising - industrial - monitoring” complex.

Of course, advertising is not all bad - I actually find the ads on Instagram quite interesting. But we should feel regret for this dominant model because, in scenarios where developers offer “microtransactions ranging from $0.001 to $1”, an entire business sector cannot take root on the internet due to the high friction costs.

In addition, x402 cryptocurrency transactions completely detach the concept of “identity” from online commerce. In the past, when making payments online, both you and the merchant needed to provide identity information to a third party. Since traditional online banking is not an internet-native model, KYC regulations are closely tied to the internet.

What is “resource”?

“Resources” are the key elements that are missing from the internet as a native system. API quotas are a type of resource that can reflect this potential: after enterprise users register for SaaS, they may pay $1000 per month to obtain a certain quota of API resource usage rights, which is a very common model.

This economic model is the foundation for the operation of such enterprises, but thinking from another perspective: wouldn’t it be more reasonable to price API calls at 5 cents per call (settled in USDC) on the Base chain?

In the x402 system, resources are value units sold per request for a certain URL — the content you receive (or the operation you complete) after payment falls under this category, specifically including:

• Data / Results: a JSON data, a price quote, a press release, a scraped page, a SQL query result, a weather snapshot.
• Calculation / Reasoning: One large language model (LLM) generation, one image generation, one speech-to-text, one risk scoring, one embedding vector.
• Additional Effects / Actions: “Post this tweet” “Complete this lead record” “Place order” “Start the virtual machine and run for 10 minutes”.
• Permissions / Priority: “Jump the queue” “Priority email processing” “Reserve a 15-minute slot” “Unlock the express lane for this API call.”
• Process / Real-life scenario: Multi-step combination operations, such as “Generate pattern → Typesetting → Settlement → Print and ship T-shirts.”

The definition of “resources” is intentionally kept broad - it can be anything. Anything of value can be converted into callable x402 resources, whether it is human or robot, and can be invoked by them.

Robots Are Superior to Humans

x402 Of course there will be human-oriented application scenarios - for example, “Pay $20 to book my schedule” “Send an email and set it as my priority task.”

But the real magic lies in the fact that all x402 resources on the internet can automatically open up to the “intelligent agents receiving human instructions”. More importantly, intelligent agents can freely combine various resources needed to complete tasks.

This is an ultimate “financial Lego” system. For the first time, we can build native resources on the internet, and these resources can be freely combined; at the same time, large language models have the reasoning ability to determine which resources need to be called and how to combine them.

The potential of x402 is so great that it is even difficult to fully describe it in words.