Coinbase and Cloudflare have formed the x402 Foundation to make the long-ignored HTTP 402 “Payment Required” code work as a real standard for online transactions.
The announcement came on Tuesday, September 23, through a company blog post and a Cloudflare release.
We @Cloudflare are working with @coinbase to create the x402 Foundation. @programmer & others at Coinbase have created a powerful protocol to enable payments at Internet scale, and I am proud to work with them to create a foundation to standardize the protocol.
Every day, sites…
— William Allen (@williamallen) September 23, 2025
The foundation’s aim is simple: give bots, APIs, and AI agents a way to pay for data, content, or tools on demand. Cloudflare says its servers already send more than a billion “402” responses daily, but without a shared way to settle payments.
The new protocol fixes this with three steps: a server sends a payment offer, the client signs and returns it, and a facilitator verifies the settlement. That process allows pay-per-use access without subscriptions or manual billing.
Coinbase has published reference code on GitHub, and Cloudflare has integrated the system into its developer tools with a public demo.
Both companies say the foundation will serve as a neutral body to guide adoption. If it works, HTTP 402 could shift from an unused error code to a standard part of how machines pay for services online.
Cloudflare is adding a deferred-settlement option to x402, letting providers batch charges through cards, banks, or stablecoins when instant blockchain settlement isn’t needed.
Coinbase has framed the new foundation as the path to make x402 a universal standard for AI-driven payments, built on open governance, ecosystem grants, and cross-platform interoperability.
Cloudflare’s newsroom statement credits Coinbase with creating the protocol but presents the foundation as neutral, calling on more members to prevent fragmentation.
The process is simple: a server issues an HTTP 402 with payment instructions, the client responds with a signed header, a facilitator verifies and settles, and the server delivers the resource with a payment confirmation.
Cloudflare has already built this into its Agents SDK and MCP servers, and it launched a public playground that funds a test wallet on Base testnet so developers can try it firsthand.
If adoption spreads, x402 could give AI agents and web services a shared way to pay as they go, whether through crypto or traditional rails.
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Coinbase’s GitHub now hosts the x402 spec, sample code, and a one-line middleware example.
The protocol is pitched as near fee-free with instant settlement, aimed at micro-transactions that card networks can’t handle efficiently.
Within hours of the launch, the Cardano Foundation said it will work with Masumi to adopt x402 for agent-to-agent payments, adding it to its roadmap alongside token standard work on CIP-0113 and CIP-0143.
Recently, we had the chance to present the Masumi Network at the Cardano Seminar by the Cardano Foundation.
Check out the recording pic.twitter.com/0IKdlz6tJD
— Masumi (@MasumiNetwork) September 18, 2025
The effort signals Coinbase and Cloudflare’s intent to move payments into the internet’s core plumbing, not just applications.
If successful, AI agents could pay as they go for data, compute, or premium services without accounts or subscriptions, creating new revenue channels for API providers and publishers.
Cloudflare’s deferred-settlement design reflects enterprise needs for card or bank rails with dispute windows, while stablecoins cover instant transfers.
But x402 is not alone. It faces competition from Google’s AP2, where interoperability and credible governance may determine which standard prevails – a project also involving… You guessed it, Coinbase.
Bringing stablecoin payments to AI agents with @Google. https://t.co/B9p3KUkD8p
— Coinbase
(@coinbase) September 16, 2025
“Coinbase deserves immense credit for starting the work on the x402 protocol … we’re excited to partner with them on our shared vision for a neutral foundation,” Cloudflare CEO Matthew Prince said in the press release.
Coinbase’s Erik Reppel called agentic commerce a “once-in-a-generation opportunity,” saying the foundation will “lay the groundwork” to make it real.
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