x402 V2 is here. What are the major upgrades in the new protocol?

Coinbase stated that this update restructures the protocol, making it more universal, flexible, and easier to extend across networks, transport methods, identity models, and payment types. It marks a shift in the protocol's focus from "what it can do" to "how it integrates seamlessly with existing services."

Compiled by: Felix, PANews

The x402 protocol, which recently went viral, has made new progress. Incubated by Coinbase and designed specifically for AI agents, the open-source payment protocol x402 released its V2 version on December 11th. This version optimizes upon V1, expanding from a single-call payment method to a unified internet payment layer.

Initially released in May 2025, x402's concept is to embed payments directly into HTTP using long-dormant 402 status codes. Within just a few months, x402 processed over 100 million payments from APIs, applications, and AI agents, supporting a wide range of applications from paid API calls to autonomous agents purchasing computing and data on demand.

Coinbase stated that this update restructures the protocol, making it more universal, flexible, and easier to extend across networks, transport methods, identity models, and payment types. It marks a shift in the protocol's focus from "what it can do" to "how it integrates seamlessly with existing services."

Unified payment interface

The x402 V2 introduces a standardized payment interface that connects blockchain networks and traditional payment systems. It supports multiple blockchains, including Base and Solana, while maintaining compatibility with ACH and card networks.

x402 V2 simplifies developer integration by creating a single format for identifying networks and assets. Developers can build cross-chain payment processes without complex tweaks or custom logic. This unified architecture supports flexible payment models, including subscriptions, prepaid, and multi-step billing.

This update also introduces dynamic "payTo" routing, which can route funds to a specified address, role, or callback-based payment logic based on the request. This feature is ideal for marketplace platforms and multi-tenant APIs. Furthermore, it enables dynamic pricing based on input data.

Scalable architecture and compatibility

The modular architecture introduced in version V2 separates the protocol specification, SDK implementation, and payment service providers. This structure makes x402 V2 plug-in driven, allowing developers to add new blockchains or payment behaviors without changing the core protocol.

x402 V2 integrates lifecycle hooks, allowing builders to insert custom logic at critical points in the payment process, such as before/after payment sending and before/after settlement verification. These hooks support complex features such as conditional routing, fault recovery, and metric monitoring. In this way, x402 V2 improves efficiency and reliability across various financial environments.

The updated SDK supports multiple payment service providers simultaneously, and developers can prioritize networks or assets according to their preferences. This flexibility ensures smoother payment routing across blockchains and platforms. x402 V2 enhances interoperability, stability, and developer efficiency within a unified framework.

Wallet access and developer experience

The x402 V2 also refactors wallet and identity management. By introducing reusable wallet sessions, it eliminates redundant payment verification for returning users or AI agents. This feature reduces transaction latency and improves cost-effectiveness in high-frequency payment environments.

The system includes a modular paywall component package that supports custom payment backends for the EVM and Solana networks. This modular design encourages developers to build and adapt paywalls to different business models. It also lays the foundation for future wallet-based identity standards such as "Log in with X".

The x402 V2 update automates service discovery and metadata management through its Discovery extension. This allows service providers to index services, update prices, and manage routes without human intervention.

Coinbase stated that the launch of x402 protocol version V2 represents another significant milestone in enabling value to flow as easily as information on the internet. By expanding compatibility, simplifying the developer experience, and supporting new payment and identity models, V2 transforms x402 into a more flexible payment layer, supporting human, application, and agent-driven payments.

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