Agentic Wallets FAQ 4: What Is the x402 Protocol?

The x402 protocol is a machine-to-machine payment system that enables AI agents to make autonomous payments without human intervention. Named after the HTTP 402 "Payment Required" status code that was planned but never implemented in traditional web infrastructure, x402 has processed over 50 million transactions since launch.

What it enables:

• API paywalls: Agents authenticate and pay per request for premium services
• Compute resource metering: Agents rent GPU or processing power and pay per-second usage
• Data stream subscriptions: Agents access premium information feeds with per-query payment
• Agent-to-agent commerce: Agents pay each other for services or outputs

Why it matters:

Unlike credit card processing or bank transfers that require human confirmation and take days to settle, x402 executes at code speed with per-transaction costs measured in cents, not percentage fees. This makes micro-payments economically viable.

An AI agent can purchase a single API call for $0.01, rent GPU resources for 30 seconds for $0.05, or buy a specific dataset for $2.50—all without pre-arranged billing relationships, monthly subscriptions, or human approval. The pay-as-you-go model optimizes costs while maintaining access to premium capabilities exactly when needed.