The Linux Foundation has launched the x402 Foundation, a new body tasked with governing and standardizing the x402 protocol for agentic AI payments across both cryptocurrency and fiat payment systems. The foundation was established on Thursday with the support of Coinbase, the original creators of the x402 protocol. The initiative brings together some of the largest names in technology and finance under a shared open-source framework.
Founding members include Google, Microsoft, Amazon Web Services, American Express, Mastercard, Visa, Cloudflare, Shopify, Stripe, Circle, Base, Polygon Labs, Solana Foundation, Thirdweb, and KakaoPay. The breadth of membership spans cloud infrastructure providers, payment networks, and blockchain ecosystems. This diversity signals broad industry interest in establishing a common standard for machine-driven transactions.
Jim Zemlin, CEO of the Linux Foundation, argues that the x402 protocol should follow an open-source structure because the internet itself was built on open protocols. Housing the protocol within the Linux Foundation gives it what Coinbase describes as a neutral, nonprofit home. The Linux Foundation is widely regarded as one of the largest and most influential open-source software nonprofits in the world, and its backing is expected to attract wider support from developers and technology firms than a company-led launch would.
The foundation’s creation reflects a growing industry conviction that AI agents are on course to become the dominant users of blockchain payment systems. Coinbase CEO Brian Armstrong states that AI agents will be transacting online more frequently than humans very soon. Circle CEO Jeremy Allaire made similar remarks in January, predicting that billions of AI agents will be conducting on-chain transactions within three to five years.
Former Binance CEO Changpeng Zhao also stated in January that cryptocurrency is the native currency for AI agents, which he expects will autonomously handle tasks ranging from purchasing tickets to paying bills, all without relying on credit cards. These perspectives collectively point to a significant anticipated shift in how digital payments are initiated and processed. The x402 protocol is positioned as the infrastructure layer to support that transition.
On a technical level, the x402 protocol uses the HTTP 402 “Payment Required” status code alongside Ethereum Improvement Proposal 3009, a pre-signed authorization feature, to allow AI agents to transfer funds automatically. This design removes the need for manual approval and eliminates gas fee payments during transactions. The combination is intended to make machine-to-machine payments seamless and efficient at scale.
Despite the momentum behind the foundation’s launch, on-chain data from Dune Analytics shows that transaction activity for the x402 protocol has declined considerably since a peak in late 2024. Weekly transactions reached a high of 13.7 million during the week of November 4 to 10, followed closely by 13.66 million the following week. Since then, weekly transaction volumes have dropped sharply, ranging between approximately 29,000 and 1.1 million transactions.
Originally reported by CoinTelegraph.
