23 Oct
23Oct

Coinbase has launched a new system called Payments MCP (Model Context Protocol) that directly connects artificial intelligence (AI) agents with crypto payments, enabling them to hold wallets, send stablecoin payments, and interact with online services autonomously.

The system is built on x402, Coinbase's open payment standard based on the unused "HTTP 402: Payment Required" code. This launch, according to Coinbase's head of engineering, Erik Reppel, finally creates an open, digital-native payment standard for machines, something people have sought since the 1990s. Reppel argues that crypto is uniquely suited for machine-to-machine transactions.

How Payments MCP Works

  • Agent Compatibility: Payments MCP works with major AI models, including Anthropic's Claude, Google's Gemini, OpenAI's Codex, and Cherry Studio, allowing agents to manage funds and send stablecoin payments directly from a prompt. Support for ChatGPT is planned for the future.
  • Accessible to Non-Coders: The system aims to make "agentic commerce" simple for everyone. Users can create and fund wallets with just an email address—no developer setup or API keys are required.
  • Instant Transactions: Through the x402 Bazaar Explorer, agents can browse and pay for services directly. An integrated onramp and guest checkout allow for almost instant transactions in supported regions.
  • Guardrails and Security: The system incorporates robust compliance and safeguards. Each agent wallet has configurable funding limits, approval thresholds, and session caps. Agents only have access to dedicated funds given to them, meaning they cannot access a user's main wallet. Coinbase handles necessary KYC (Know Your Customer) regulations under the hood, ensuring compliance without affecting the user experience.
  • Open Standard: To ensure longevity and neutrality, Coinbase and Cloudflare are backing the x402 Foundation to maintain the protocol as open-source infrastructure.

Coinbase predicts that 2026 will be the "year of agentic payments," where AI systems programmatically buy services like compute and data. Reppel suggests that most users won't even realize they're using crypto; they'll simply see an AI balance go down, with the instant settlement happening behind the scenes via stablecoins.

October 2025, Cryptoniteuae

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