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Coinbase’s experimental x402 payments protocol, aimed at enabling both AI agents and individuals to transact directly in stablecoins online, has seen a remarkable increase in usage.
Key Takeaways:
- Coinbase’s x402 protocol experienced a 10,000% rise in transactions, handling nearly 500,000 payments within a week.
- The protocol revitalizes the HTTP 402 “Payment Required” status to facilitate immediate on-chain stablecoin transactions.
- Growing interest from developers has sparked the launch of x402-powered tokens.
Data from Dune Analytics indicates that the payments protocol has surged over 10,000% in transactions during the last month.
Coinbase’s x402 Revives HTTP 402 to Enable Instant On-Chain Payments
Initially launched in May, x402 reinterprets the seldom-used HTTP 402 status code, “Payment Required,” as a foundational internet payment layer.
This allows for automatic, real-time transactions without the need for credit cards or intermediaries.
Users or AI agents can request a service, receive a 402 payment prompt, and transmit a signed stablecoin payment, which the system then verifies on-chain.
Between October 14 and 20, the protocol processed nearly 500,000 transactions, marking a 10,780% increase compared to the prior month.
Transaction activity peaked on Friday with 239,505 transactions recorded, while Thursday noted a high of $332,000 in transaction volume.
This sudden increase coincides with heightened interest in “agentic AI,” autonomous AI systems capable of managing finances and resources, as highlighted in a16z Crypto’s 2025 State of Crypto report released this week.
The firm estimated that such agents could facilitate up to $30 trillion in autonomous transactions by 2030.
x402 growing like crazy
link in thread https://t.co/xAghleCzJq— Brian Armstrong (@brian_armstrong) October 24, 2025
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Coinbase developers Kevin Leffew and Lincoln Murr explained in August that x402 could establish a new financial layer for digital agents, enabling them to pay for computing, storage, or even transportation without human involvement.
“They require atomic payments, programmable policies, and composable wallets,” they stated. “Ethereum and stablecoins provide them with precisely that.”
Developers have also started utilizing the x402 framework to introduce new tokens, leading to a surge of x402-powered memecoin initiatives, according to KuCoin Ventures.
The trend was significant enough for CoinGecko to categorize “x402 tokens” separately, which has since expanded into a $180 million market, reflecting a 266% increase in just 24 hours.
Coinbase’s new protocol highlights a broader transition toward the integration of AI and on-chain finance, where machines can autonomously manage payments and data without intermediaries.
If adoption continues at this rate, x402 could establish the first functional link between AI systems and blockchain-based economic activities, a crucial advancement toward what Coinbase previously referred to as “fixing the internet’s first mistake.”
Coinbase Faces Scrutiny After AI Coding Tool Vulnerability Exposes Security Risks
Last month, a vulnerability in Cursor, the AI-driven coding assistant reportedly utilized by all Coinbase engineers, raised significant alarm in both the crypto and cybersecurity sectors.
The flaw, known as the “CopyPasta License Attack,” was disclosed by cybersecurity firm HiddenLayer and permits hackers to embed concealed markdown instructions that disseminate malware through developer files such as README.md and LICENSE.txt.
Once activated, the attack can jeopardize entire codebases with minimal user intervention.
HiddenLayer illustrated how the vulnerability could covertly inject harmful code capable of stealing data, establishing backdoors, or modifying essential systems.
The firm indicated that similar threats are present in other AI coding tools like Windsurf, Kiro, and Aider. This revelation followed shortly after Coinbase CEO Brian Armstrong announced that AI now generates up to 40% of the company’s code, with intentions to increase that percentage to 50%.
Critics, including developers and academics, cautioned that Coinbase’s swift AI implementation could pose risks to user assets and fundamental infrastructure.
The post Coinbase’s x402 AI Payments Protocol Sees 10,000% Surge in Activity appeared first on Cryptonews.
