X402 Protocol: Unleashing AI’s Economic Power – Navigating Compliance Challenges

This article analyzes the X402 protocol, promoted by Coinbase, which unlocks the potential of the HTTP 402 status code for AI-powered transactions. By enabling ‘request-as-payment’ atomic transactions between machines, it empowers AI to independently initiate and execute payments, unlocking new possibilities in sectors like computing power procurement. The X402 protocol pushes beyond traditional payment systems by introducing ‘machine autonomy’, a paradigm shift driven by the rise of AI agents. This article explores its potential, challenges, and compliance strategies for businesses and users.