To explain the current x402 wave using a newbie metaphor.

Author: BroLeon from Australia; Source: X, @BroLeonAus

Suddenly in the group, Little Lioness asked: “What exactly is x402?”

I suddenly realized:

Although there are many hardcore analysis articles written in the market, for most retail investors, it is still difficult to understand what this suddenly popular thing actually is? How did it get involved in the love-hate relationships of CEXs? Whether it's Ping, Payai, or KiteAi, what do these projects have in common? What are 8004, ACP, etc.? It's so confusing.

I tried to explain it to beginners using an analogy from a somewhat inappropriate real-life scenario, so that it would be relatively easy to understand the situation.

First:

Imagine Ai Agents as cars;

Think of the AI agency launch platform as a car manufacturing factory;

Imagine each public chain as a territory;

Imagine each CEX as a country;

Imagine 402 as the newly launched ETC card system.

Current Situation:

Currently, there are many car manufacturers (launch pads) distributed across various countries (chains), such as the well-known traditional car manufacturer - @virtuals_io in Base country.

One day, Country C came up with a new invention – adding an ETC card to cars, so that drivers wouldn't have to stop when passing through highway toll booths. After this invention (x402) was announced, the news reported extensively on it, but it quickly faded into silence (News about the AP2 protocol and x402 standard launched in collaboration between Coinbase and Google).

One month later, on a certain day, a propaganda minister from country C ($Ping ) took office, who had exceptional speaking skills. He mobilized major television stations and media from various countries to intensively focus on the ETC technology in a very short time. As a result, people flocked to it, and suddenly countries around the world saw how much economic value this ETC could generate.

Country O next door discovered an opportunity and immediately contacted Country C, deciding to promote the ETC in their own country. They verbally promised that all cars they manufacture in the future will be equipped with Country C's ETC cards, further boosting the market's enthusiasm for ETC cards.

The crowd in the market has started to invest in ETC technology-related targets under the influence of various channels, so not only did the minister's own stocks rise, but the stocks of car manufacturers that can install cards in bulk for vehicles ()$Virtual also surged. Securities exchanges in various countries have opened ETC-related concept stock sectors (various wallets have launched the x402 sector).

However, the powerful country B did not immediately follow suit by introducing this ETC system unchanged. The reason is simple: those who create the standards are always at the top of the food chain. Should we really be followers? China has suffered losses from this in the early years.

Is this ETC standard really that difficult? Can only the ETC from country C be used? No, the real choice facing the government of country B is whether to create its own bETC to equip its country's vehicles, or to directly use the ETC from country C.

The benefit is that there will be global uniformity, so cars can be driven anywhere in the world without having to stop at toll booths to pay fees. The downside is that we end up following the lead of other countries, and our own people can only buy stocks from other countries to take over. – This is the important reason I previously mentioned for closely monitoring the policies of Country B.

What are the projects I mentioned earlier, such as $Payai, @GoKiteAI, @Unibase_AI, @virtuals_io, doing respectively?

I still use the front car as a metaphor:

Now every country has some cars driving on their respective highways, but the standards for cars are not uniform; each manufacturer produces slightly different vehicles. Some have three wheels, some have five, some have doors on the top, while others have them in the front, and there are both luxury sports cars and “old man joys.”

It would be great if someone could unify the standards for car manufacturing, as it could save a lot of production costs globally and make it more convenient for users when choosing cars.

To address this pain point, the established car manufacturer @virtuals_io early on unified its own automotive standard ACP, and now 90% of the cars they produce follow this standard, making it a natural progression to include ETC as well.

The car manufacturer in Country B, @Unibase_AI, also intends to do this. Their car standard is erc8004 — fully known as Trustless Agents. They also claim to soon release Country B's first blockbuster car equipped with ETC, which is why their stock has surged recently.

So what about PayAI?

PayAI is an ETC patch compatible with cars from multiple countries. Cars from various countries can use ETC after plugging in their patch. Although it is a product from Country S, its compatibility is quite strong.

The core team is the developer of C country's ETC technology (x402 protocol), which gives it a significant advantage. As the market gradually understands the ins and outs of ETC technology, investors are starting to vote with their feet, and the stock price is soaring.

Finally, it's @GoKiteAI.

This person is impressive; what they want to do is create a separate global highway network, standardizing all vehicles on this highway, and inherently equipped with ETC.

Because it is not a case of switching careers halfway, but rather a complete rebuild, achieving autonomous driving and vehicle-to-vehicle communication in this network will be much easier than implementing uniform cars across various countries.

Of course, the costs will be much higher, the difficulty will be greater, and it will be more expensive, but the market is currently very promising (including me).

As a heavy user of AI, I have no doubt that the future world, from Web2 to Web3, will be a world filled with AI agents, and the competition for important standards will naturally be a part of industry development.

Seeing the competition of Nofi.ai's agents in trading, I feel that the infiltration of AI agents into the Web3 world is not far away, and 402 is indeed an important step in helping them break the dimensional wall. I hope I can seize quality targets in this wave.

The above analogy may not be very appropriate, but it is only for the purpose of better educating the market. Experts are kindly requested to provide constructive criticism and are welcome to suggest better and more fitting analogies and expressions.

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