x402 is becoming increasingly competitive, seize new asset opportunities in ERC-8004 ahead of time

Original Title: "x402 Intensifies, Unearthing New Asset Opportunities in ERC-8004 Ahead of the Curve"

Original Author: David, Deep Tide TechFlow

x402 has clearly become a sensation.

According to CoinmarketCap data, trading volume for various projects within the x402 ecosystem has surged 137-fold, and the first ecosystem token, PING, soared from zero to a market cap of $30 million in just a few days.

KOLs from all sides are publishing intensive analyses, covering everything from technical principles to project reviews—every angle you can think of has been written about.

Yet two weeks ago, when we were among the first to analyze x402 and mention the potential of projects like PayAI, the market was relatively quiet.

In a market where narratives and token lifecycles are rapidly shortening, researching new narratives ahead of time makes it easier to lock in opportunities related to those assets.

Now, every time you refresh Twitter, a new "x402 ecosystem project" pops up; frankly, if you're only starting to research x402 now, it might already be a bit late.

It's not that the protocol itself lacks prospects, but rather that the most obvious alpha opportunities have already been fully exploited.

But while everyone is focused on x402, attentive observers will notice that another protocol has recently been frequently discussed in the English-speaking crypto community:

ERC-8004.

Even more interestingly, Davide Crapis, one of the proposers of ERC-8004 and head of the Ethereum Foundation's dAI team, revealed a detail in a September interview with Decrypt:

"ERC-8004 will support multiple payment methods, but having x402 extensions helps improve the developer experience."

Wait, support multiple payment methods? Isn't x402 a payment protocol? Why does ERC-8004 also involve payments—are they competitors or complementary?

In early October, when the Ethereum Foundation announced the final version of ERC-8004, the signatories included Marco De Rossi from MetaMask, Jordan Ellis from Google, and Erik Reppel from Coinbase, who is also the creator of x402.

The same person is driving both protocols. What's the logic behind this?

If the explosion of x402 made everyone see the huge market for AI Agent payments, then ERC-8004 may represent the other half of the puzzle in this market that has yet to be fully recognized.

When everyone is chasing the payment track, perhaps the real opportunity lies outside of payments.

ERC-8004: The Prerequisite for Payments is Identity Registration for AI

To understand ERC-8004, we must first return to a fundamental issue in the AI Agent economy.

Imagine a scenario where AIs collaborate:

Your personal AI assistant needs to complete a complex task: preparing a market analysis report for your upcoming product launch.

This task exceeds its capabilities, so it needs to hire other specialized AIs: one for data scraping, one for competitor analysis, and one for chart creation.

Now with x402, payments are no longer an issue; a few lines of code can complete a USDC transfer. But before payment, your AI assistant faces a series of tricky identity issues:

Among these self-proclaimed "professional data analysis AIs," which are genuine and which are scammers? How was their past work quality? How many clients gave positive reviews, and how many complaints were there?

This is a bit like doing business in a world without Taobao, Dianping, or business registration authorities. Every transaction is a blind box, every collaboration a gamble.

Therefore, to put it in one sentence, ERC-8004 is the "business registration bureau + credit system + qualification certification center" for AI Agents on-chain.

It gives every AI Agent an ID card, credit record, and capability certification, all recorded on the blockchain—publicly queryable and tamper-proof.

On August 13 this year, Davide Crapis from the Ethereum Foundation, Marco De Rossi from MetaMask, and an independent AI developer Jordan Ellis jointly submitted the EIP-8004 proposal.

Interestingly, Jordan Ellis was later confirmed to have close ties with Google’s Agent-to-Agent team.

Simply put, ERC-8004 adds a trust layer to Google’s A2A. In the words of the Ethereum Foundation, this is about establishing a "trusted neutral track" for AI Agents.

Leaving aside the complex code details, let’s take a rough look at how 8004 works.

The design of ERC-8004 is extremely streamlined, containing only three on-chain registries:

· Identity Registry Each AI Agent receives an ERC-721 token as an ID card. Yes, you read that right, AI Agents are NFT-ized. This means an Agent’s identity can be viewed, transferred, or even traded in any NFT-compatible wallet.

This NFT points to a standardized "Agent card," describing the Agent’s name, skills, endpoints, and metadata. Because it follows open standards, any browser or marketplace can index it, enabling cross-platform permissionless discovery.

· Reputation Registry This is the "Dianping" of the AI Agent world. Clients and other Agents can submit structured feedback, tagging by skill or task. More importantly, x402 payment proofs can be attached. Only clients who have actually paid can review, preventing fake reviews.

All reputation signals are public goods. This means anyone can build their own reputation scoring system based on this data.

· Validation Registry For high-value tasks, reviews alone are not enough. The validation registry allows Agents to request third-party validation—this could be TEE (Trusted Execution Environment) oracles, staked guarantee inference, or zkML verification.

This is the qualification certification in the Agent world. An Agent claiming to do financial analysis can cryptographically prove it ran a specific model and produced specific results.

If this sounds a bit technical, let’s look at a concrete example.

Suppose an exchange’s AI Agent needs a weekly DeFi market analysis report but lacks the capability itself.

· Search for Service: The client Agent finds analyst Agent Alice via the identity registry and checks her NFT identity card’s service description.

· Check Reputation: Finds Alice has 156 positive reviews, an 89% completion rate, and real reviews with x402 payment proofs.

· Escrow Payment: Pays 100 USDC via x402 to a smart contract escrow, not directly to Alice.

· Third-Party Validation: After Alice completes the report, validator Bob checks the quality and signs confirmation in the validation registry.

· Automatic Settlement: The contract sees validation passed, automatically releases funds to Alice, and the client leaves a review.

(Source: Researcher Yehia Tarek’s personal column)

The entire process requires no human intervention; three AI Agents autonomously completed a business transaction based on the ERC-8004 trust system.

Wait, does this have anything to do with x402?

To clarify the relationship between x402 and ERC-8004 in one sentence:

x402 solves the payment problem for AI Agents, ERC-8004 solves the trust problem, and a truly autonomous AI economy needs both.

Specifically, x402 is a standard for micropayments between agents or users, eliminating payment friction and allowing one agent to automatically pay another for task completion.

ERC-8004 is the identity and reputation layer for agents. It introduces on-chain verification, making every task and score traceable.

An easier analogy:

· x402 = ERC20

· ERC-8004 = Etherscan

The former allows you to pay API access fees directly by call count, acting as a payment standard; the latter is more like an on-chain AI agent registry, with each agent having an associated wallet that can be queried and verified.

In fact, all of this is part of a broader "crypto x AI" narrative. In a large crypto AI economy:

· Crypto AI Economy = Discovering AI Agents + Communication Between AI Agents + Verifiable Computation

(Image source: Twitter user @soubhik_deb)

How do you discover AI Agents? Essentially, it means enabling AI Agents to find each other—this is what ERC-8004 does, writing a registry on Ethereum to record AI identities.

How do you enable communication between AI Agents? x402 is an open standard for on-chain payments between agents; there are also protocols like Google’s A2A.

How do you verify all this? Every AI Agent must perform verifiable reasoning, inference, and actions, which may be recorded in places emphasizing data availability.

The post by @soubhik_deb on Twitter is worth reading, as it explains the above logic clearly and can help you discover more alpha project opportunities based on this logic.

At this point, we fully understand the relationship between x402 and ERC-8004; it’s more appropriate to describe their relationship as complementary and jointly constructing the full picture of the AI economy.

If you want a clearer and more direct comparison, here’s a one-picture summary:

Beneficiary Projects Under the ERC-8004 Narrative

Too long, didn’t read version: you can refer directly to the chart below.

When x402 exploded, payment tokens like PING were the first to surge. But ERC-8004’s opportunities are more widely distributed—from infrastructure to applications, each layer has its own logic. Understanding this logic is more important than chasing individual projects.

1. First is the infrastructure layer, such as Taiko and EigenLayer.

Taiko, L2 Execution Layer

Why would an L2 be the most active supporter? The narrative here is that the Agent economy needs cheap and fast chains. Mainnet is too expensive—every identity or reputation update costs several dollars in gas fees, which is unaffordable for Agents. Taiko offers a solution by deploying the 8004 registry on L2, reducing costs. The contract was deployed on October 24 and may become the main battleground for Agent activity.

EigenLayer, Security Layer

The biggest challenge for 8004 is what to do if validators act maliciously? EigenLayer’s answer: slashing. Validators stake ETH, and if they provide false validation, their assets are slashed. EigenLayer is integrating 8004 into over 200 AVSs, each potentially becoming a dedicated Agent validation service.

The logic for infrastructure is simple: the more Agents, the more transactions, the more revenue. It’s the business of selling shovels.

2. Next is the middleware layer, such as S.A.N.T.A and Unibase.

S.A.N.T.A, Payment Bridge

Its positioning straddles both narratives, acting as a connector between x402 and 8004. When one Agent finds another via 8004 and then needs to pay via x402, S.A.N.T.A handles the process. More importantly, it enables cross-chain operations—for example, if a Solana Agent wants to hire an Ethereum Agent in the ideal narrative, S.A.N.T.A can play a role.

Unibase, Memory Layer

Agents need not only identity but also memory. Unibase gives each Agent persistent storage, linked through the 8004 identity system. This means Agents can "remember" previous interactions, accumulate experience, and even share knowledge. On October 26, it achieved x402+8004 integration on the BNB Chain, taking the lead.

The value of middleware lies in its irreplaceability. You can switch L2s, but some connection functions are unique.

3. Finally, the application layer, such as the familiar Virtuals Protocol.

Virtuals is an AI Agent token issuance platform, allowing users to create, invest in, and trade AI Agent tokens via a bonding curve mechanism.

Currently, there are over 1,000 Agent projects on the platform, with daily trading volume exceeding $20 million.

For Virtuals, 8004 solves a practical problem: how to enable different Agents to recognize and interact with each other. Recently, its official Twitter announced that the ACP protocol update will fully support the 8004 standard, meaning every Agent issued on Virtuals will automatically receive an on-chain identity and reputation system.

As for which application will break out, perhaps it can be combined with Launchpad gameplay, and further observations can be made regarding updates in rule design and incentives.

Overall, x402 solves the payment problem, ERC-8004 solves the trust problem. x402 took five months from launch to explosion; 8004 may be even faster.

In terms of timing, pay attention to Devconnect on November 21, which will feature a Trustless Agents Day showcase. The first batch of applications based on 8004 may demonstrate their features at the conference. If a killer app emerges, it could trigger the first wave of hype.

By the end of this year, I predict that x402 ecosystem projects will enter a consolidation phase and are likely to announce support for 8004. The synergy between the two protocols will produce a 1+1>2 effect.

If you are a conservative player, you might focus on large-cap infrastructure projects benefiting from 8004; if you are more aggressive, you need to closely monitor the small-cap projects in the table above and watch for new projects emerging.

After all, it’s been a long time since the crypto market was dominated by a narrative driven by technology. Whether x402 and ERC-8004 are just a flash in the pan or have far-reaching impact will be left to the market to decide.