An online payments protocol introduced by Coinbase in May, which enables AI agents to transact in stablecoins over the internet, has experienced a dramatic increase in transaction activity, exceeding 10,000% in the past month.
At its launch, Coinbase stated that x402 addresses "the internet’s first mistake" by reviving the Internet Communication Protocol's Hypertext Transfer Protocol 402 (HTTP 402) to establish a seamless payment system integrated directly into the internet.
This system allows both AI and humans to make direct payments while interacting with websites or applications. Users or agents request a service, receive an HTTP 402 "Payment Required" prompt, and then submit a signed stablecoin payment, which x402 automatically verifies without the need for credit cards.
According to data from Dune Analytics, there were nearly 500,000 x402 transactions recorded between October 14 and October 20. This represents a significant 10,780% increase compared to the transaction levels observed four weeks prior.
Transaction activity reached even higher peaks on Friday, with separate Dune Analytics data indicating a record 239,505 transactions processed. On Thursday, a record $332,000 in transaction volume was also posted.
This surge coincides with the tech-focused venture capital firm a16z's crypto arm highlighting agentic AI in its 2025 State of Crypto report. The report anticipated that autonomous transactions could potentially reach $30 trillion by 2030.
Without the necessity for human intervention in managing API calls, storage, and computation, agentic AIs could facilitate a wide range of applications. These include self-driving taxis covering their operational costs with stablecoins, and applications automatically utilizing stablecoins for permanent data storage, as outlined by Coinbase development team members Kevin Leffew and Lincoln Murr in August.
In a limited capacity, AI agents are already actively participating in crypto trading. They analyze market data, execute buy or sell orders, and optimize portfolios in real time without direct human oversight.
CoinGecko Lists x402 Tokens as a New Category
Developers are increasingly utilizing x402's architecture to launch tokens directly, leading to a proliferation of x402-powered memecoin launches, as noted by KuCoin Ventures on X.
The growing prominence of x402 has prompted CoinGecko to begin tracking x402 tokens as a distinct ecosystem category. This new category has rapidly expanded to a market capitalization of nearly $180 million, showing a 266% increase over the preceding 24 hours.
Ethereum Identified as the Optimal Blockchain for HTTP 402
Leffew and Murr emphasized that Ethereum's trustless settlement layer makes it the most suitable blockchain for implementing HTTP 402. They pointed out that this integration significantly enhances the efficiency of invoices and dispute chargebacks compared to traditional financial processes.
They stated, "They need atomic payments, programmable policies, and composable wallets. Ethereum and stablecoins give them exactly that."