What is the x402 Protocol?

Definition

x402 lets agents pay per API call via HTTP 402 Payment Required and EIP-3009 authorization. Each payment is on-chain.

Compliance obligations apply to x402 transactions the same as any transfer of value.

Built by Coinbase, OpenAI, and platform providers for agents consuming paid APIs.

Agents face two OFAC risks: origin of incoming payments and destination of outgoing payments.

The /x402-demo endpoint screens incoming wallets and prevents 402 responses to sanctioned sources.

1. Is x402 OFAC compliant?

x402 is a payment protocol. Compliance is the operator's responsibility. agentmail provides the screening layer.

2. Does x402 include KYC?

No. Identity verification is layered on top by the operator.

3. Do x402 payments create an audit trail?

On-chain payments do. agentmail adds OFAC context to off-chain settlements.