Stripe's push to shape the future of AI money

Stripe founders John and Patrick Collison.

Big names in crypto, payments and cloud infrastructure are racing to build the financial plumbing for a world in which AI agents — not humans — handle transactions on the internet.

Stripe, Coinbase Global and Cloudflare are forming a nonprofit foundation to govern x402, an open-source protocol that lets software make instant payments without human involvement — one of at least two competing standards vying to become the default rails for machine-to-machine commerce.

An additional 20 companies are joining the foundation as members, including Microsoft, Alphabet’s Google, Amazon Web Services, American Express, and crypto companies like Circle Internet Group, and Solana Foundation. The foundation will be housed under the Linux Foundation, a nonprofit organisation that has been long supporting the development of open source software, most notably the Linux kernel.

“By moving the x402 protocol under the stewardship of the Linux Foundation, we are ensuring that the future of agentic commerce remains neutral, interoperable, and accessible to everyone,” Stephanie Cohen, chief strategy officer at Cloudflare, said in a statement Thursday.

The move is the latest in a rapid-fire sequence of bets across the payments and crypto industries on the idea that autonomous software programs will soon need to pay for data, computing power and services millions of times a day — and that today’s payment systems, built for people with credit cards, aren’t designed to handle it. Right now, when a consumer buys something online, the payment passes through a chain of intermediaries — the merchant’s bank, the card network, the card-issuing bank — each taking a cut of the transaction.

The protocol is named after a piece of the internet’s original architecture that sat dormant for three decades. When engineers wrote the rules for how computers communicate, they set aside a status code — 402, “Payment Required” — for a future in which machines could pay for things directly. That future never materialised. Coinbase launched x402 last May to finally put the code to work, letting apps, bots and AI agents charge and settle on the spot using mostly stablecoins.

The x402 protocol has processed about 97 million transactions through Coinbase’s Base blockchain, according to data compiled by Artemis Analytics, though blockchain data suggests daily activity remains modest — roughly 54,900 daily transactions earlier this week, yet without knowing whether they were used for testing or live commerce.

A rival effort has also emerged from Stripe and the crypto venture firm Paradigm, which recently launched a competing standard called the Machine Payments Protocol alongside Tempo, a blockchain the two firms co-built for stablecoin settlements. Stripe has integrated x402, effectively positioning itself on both sides of the race. Tempo raised $500m (€433.2m) last October.

The two approaches are similar with some different strengths. With MPP, an AI agent can open a pre-paid session with a merchant. When thousands of micropayments take places, there’s no need to get a new approval each time. Meanwhile, x402 has a strong focus on blockchain-based payment rails.

Both camps have assembled broad coalitions. Tempo’s design partners include Visa Inc., Mastercard Inc., OpenAI, Anthropic and Deutsche Bank. Visa and Mastercard have begun investing heavily to ensure they remain central to whatever comes next. Visa has extended its network to support stablecoin settlements. Mastercard agreed last month to acquire stablecoin infrastructure startup BVNK for $1.8bn (€1.6bn). Stripe had already acquired stablecoin startup Bridge and crypto wallet firm Privy.

The underlying expectation driving all of this: payments between software agents will be high-frequency, low-value and global, in a pattern that fits poorly with card networks charging elevated interchange fees. In a world where software optimises for cost, those fees become an obvious target.

That logic rattled markets in February. A research note from Citrini Research imagining AI agents bypassing card networks for cheaper stablecoin-based settlements, sent stocks of payment giants tumbling in a single session.

The regulatory backdrop has shifted to accommodate the push. The GENIUS Act, signed into law last July, created the first US federal framework for stablecoins, requiring issuers to back every coin one-for-one with dollars and submit to government oversight. Cloudflare has announced plans for NET Dollar, its own dollar-backed stablecoin for automated transactions between AI agents, though it has not yet launched.

For now, the competition is less about which protocol is technically superior than about which one signs up the most developers, platforms and enterprise partners first. The standard that becomes the default for AI agent payments could end up as foundational to machine commerce as card networks have been to human spending — or it could remain a niche experiment if the vision of billions of autonomous software transactions fails to materialise at the scale its backers expect.

“By backing the x402 Foundation, we’re helping build the native payment layer the internet has never had - one that’s global, programmable, and always on,” said Shan Aggarwal, chief business officer at Coinbase.

Bloomberg