x402 is gradually succumbing to internal strife, preemptively mining new asset opportunities within ERC-8004
Original Article Title: "x402 Gradually Navigating Inward, Preemptively Unearthing New Asset Opportunities in ERC-8004"
Original Article Author: David, Deep Tide TechFlow
x402 is clearly on fire.
CoinmarketCap data shows that the trading volume of various projects in the x402 ecosystem has surged by 137x, with the first ecosystem token PING skyrocketing from zero to a $30 million market cap in just a few days.
All kinds of Key Opinion Leaders (KOLs) have intensively published analyses, covering every angle from technical principles to project inventories.
However, two weeks ago, when we conducted early analysis of x402 and mentioned the potential of projects like PayAI, the market didn't react much.
In various narratives and rapidly shortened token lifecycles, conducting early research on new narratives makes it easier to identify opportunities related to assets.
Now, every time you refresh Twitter, a new "x402 ecosystem project" pops up; if you are just starting to research x402 now, to be honest, you may be a bit late.
This is not to say that the protocol itself lacks prospects, but the most obvious Alpha opportunity has already been extensively explored.
But just when everyone is focusing on x402, the observant will notice that another protocol has been frequently mentioned in English-speaking crypto circles recently:
ERC-8004.

What's even more interesting is that one of the proposers of ERC-8004, Davide Crapis, 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 an x402 extension contributes to the developer experience."
Wait a minute, supporting multiple payment methods? Isn't x402 a payment protocol? Why does ERC-8004 also involve payments? Are they in competition or complementary?
In early October, when the Ethereum Foundation announced the final version of ERC-8004, the signatories included Marco De Rossi of MetaMask, Jordan Ellis of Google, and Erik Reppel of Coinbase, who is also the creator of x402.
The Same Person Driving Two Protocols at Once. What's the Logic Behind It?
If the x402 outbreak showcased the massive market for AI Agent payments, ERC-8004 might represent the other half of this puzzle that has yet to be fully recognized in this market.
While everyone is chasing after the payment track, perhaps the real opportunity lies outside of payments.
ERC-8004: The Prerequisite for Payments Is Identifying AI
To understand ERC-8004, we first need to revisit a fundamental question 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 an upcoming product launch.
This task is beyond its capabilities, so it needs to hire other specialized AIs: one for data scraping, one for competitive analysis, and one for chart creation.
With x402 in place, payment is not an issue; a few lines of code can handle the USDC transfer. But before payment, your AI assistant faces a series of tricky identity issues:
Which of these self-proclaimed "professional data analysis AIs" is genuine, and which is a fraud? What is their past work quality? How many clients have given positive feedback, and how many have complained?
This is a bit like doing business in a world without Taobao, Yelp, or business registrations. Each transaction is a blind box, and every collaboration is a gamble.
Therefore, if we must explain it in one sentence, ERC-8004 is the "Business Bureau + Credit System + Qualification Accreditation Center" for AI Agents in the blockchain world.
It gives each AI Agent an ID, credit record, and capability accreditation, all recorded on the blockchain, open for anyone to verify and impossible for anyone to tamper with.

On August 13th of this year, Davide Crapis from the Ethereum Foundation, Marco De Rossi from MetaMask, and independent AI developer Jordan Ellis jointly submitted the EIP-8004 proposal.
Interestingly, this Jordan Ellis was later confirmed to have close ties to Google's Agent-to-Agent team.

In simple terms, ERC-8004 adds a trust layer to Google's A2A. In the words of the Ethereum Foundation, this is to establish a "trusted neutral channel" for building AI Agents.
Leaving aside the intricate details of the code, we can roughly see what 8004 does.
ERC-8004 is designed to be extremely concise, comprising only three on-chain registries:
· Identity Registry where each AI Agent receives an ERC-721 token as proof of identity. Yes, you read that right, AI Agents have been NFT-ized. This means an Agent's identity can be viewed, transferred, and even traded in any NFT-supporting wallet.
This NFT points to a standardized "Agent Card" detailing the Agent's name, skills, endpoint, and metadata. As it adheres to an open standard, any browser or marketplace can index it, enabling permissionless cross-platform discovery.
· Reputation Registry acting as the "Yelp" of the AI Agent world. Clients and other Agents can submit structured feedback, tagging it by skill or task. More significantly, they can attach x402 payment proofs. 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, mere feedback isn't sufficient. The Validation Registry allows Agents to request third-party validations—be it TEE (Trusted Execution Environment) oracles, staking-backed reasoning, or zkML proofs.

This is the credentialing of the Agent world. An Agent claiming to perform financial analysis can cryptographically prove it has indeed run a specific model and produced specific results.
If things get a bit technical, let's look at a specific example.
Imagine an exchange's AI Agent needs a weekly DeFi market analysis report, but it doesn't have this capability itself.
· Search for Service: The client Agent finds analyst Agent Alice through the identity registry, and views the service description on her NFT identity card
· View Reputation: Discovers Alice has 156 positive ratings, an 89% completion rate, and real reviews with x402 payment proofs
· Escrow Payment: Pays 100 USDC through x402 to a smart contract escrow, not directly to Alice
· Third-Party Verification: After Alice completes the report, validator Bob checks the quality and signs off on the verification registry
· Automated Settlement: The contract sees the validation is successful, automatically releases the funds to Alice, and the client leaves feedback

(Source: Researcher Yehia Tarek's Personal Column)
The entire process was carried out autonomously by three AI Agents based on the ERC-8004 trust framework, without any human intervention, completing a business transaction.
Hold on, what does x402 have to do with this?
Summing up the relationship between x402 and ERC-8004:
x402 solves the payment issue for AI Agents, ERC-8004 addresses the trust problem, and a truly autonomous AI economy requires both.
Specifically, x402 is a standard for micropayments between agents or users, removing payment friction, allowing one agent to automatically pay another for completing a task.
ERC-8004 is the identity and reputation layer for agents. It introduces on-chain validation, making every task and score traceable.
An easier-to-understand analogy is:
· x402 = ERC20
· ERC 8004 = Etherscan
The former allows you to directly pay API access fees based on call count, more like a payment standard; the latter is more like an on-chain AI agent registry, where each agent has an associated wallet, making it queryable and verifiable.
In fact, all of this is part of a broader "Crypto x AI" narrative, within a larger crypto AI economy:
· Crypto AI Economy = Discoverable AI Agents + Communicating AI Agents + Verifiable Computation

(Image Source: Twitter user @soubhik_deb)
How do you discover AI Agents then? Essentially, it means AI agents need to find each other, which is what ERC-8004 does by creating a registry on Ethereum to record the identities of AIs;
How do AI Agents communicate with each other? x402 is an open standard for agents to perform on-chain payments; there's also Google's A2A protocol, among others;
How do you verify all of this? Each AI Agent must engage in verifiable reasoning, inference, and action, which may be recorded in places that emphasize data availability.
Twitter user @soubhik_deb's post is worth reading, as it explains the above logic clearly and can be used as a basis to discover more Alpha project opportunities based on this logic.
So far, we have a full understanding of the relationship between x402 and ERC-8004, describing their relationship in terms of complementarity and mutual contribution to building the AI economy as a whole is more appropriate.
If you want a clearer and more explicit comparison, here is a flowchart:

Beneficiary Projects Under the ERC-8004 Narrative
For the TL;DR version, you can refer directly to the image below.

When x402 exploded, the first to rise was a payment token like PING. However, ERC-8004's opportunity distribution is broader, with each layer, from infrastructure to applications, having 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 avid supporter? The narrative here is that the Agent economy requires a cheap and fast chain. The mainnet is too expensive, costing several dollars in gas fees for each identity or reputation update, which Agents cannot afford. Taiko provides a solution by deploying the 8004 registry on L2, reducing costs. The contract was deployed on October 24 and could become the main battleground for Agent activity.
EigenLayer, Security Layer
The biggest challenge for 8004 is what to do when validators misbehave? EigenLayer's answer is: slashing. Validators stake ETH, and if they provide false validation, they lose their assets. EigenLayer is integrating 8004 into over 200 AVS, each of which could become a specialized Agent validation service.
The logic of infrastructure is simple: the more Agents, the more transactions, the more revenue. This is 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
It positions itself in two narratives, acting as a connector between x402 and 8004. When an Agent finds another Agent through 8004 and then needs to make a payment through x402, S.A.N.T.A handles this process. More importantly, it enables cross-chain transactions, such as an Agent on Solana in the Ideal narrative needing to hire an Agent on Ethereum, where S.A.N.T.A can facilitate.
Unibase, Memory Layer
Agents not only need identity but also memory. Unibase provides persistent storage for each Agent, associated through the 8004 identity system. This means Agents can "remember" past interactions, accumulate experience, and even share knowledge. The x402+8004 integration was achieved on the BNB chain on October 26, leading the pack.
The value of middleware lies in its irreplaceability. You can switch to a different L2, but certain connectivity features are unique.
3. Finally, there is the application layer, such as the well-known Virtuals Protocol.
Virtuals is an AI Agent token issuance platform that allows users to create, invest, and trade AI Agent tokens through a bonding curve mechanism.
Currently, the platform has over 1000 Agent projects, with a daily trading volume exceeding $20 million.
For Virtuals, 8004 addresses a real-world issue: how to enable different Agents to recognize and interact with each other. A recent official announcement indicated that the upcoming ACP protocol update will fully support the 8004 standard, meaning that every Agent issued on Virtuals will automatically receive an on-chain identity and reputation system.
As for which applications can emerge, perhaps they can be integrated with Launchpad mechanics to further observe their updates in rule design and incentives.
Overall, x402 addresses the payment problem, while ERC-8004 addresses the trust issue. x402 took 5 months from release to breakout; 8004 may be faster.
In terms of upcoming events, one can look forward to Devconnect on November 21, featuring a Trustless Agents Day showcase, where the first batch of applications based on 8004 may demonstrate their functionalities at the conference. If a killer application emerges, it may trigger the first wave of hype.
By the end of this year, the author predicts that x402 ecosystem projects will enter an integration phase, likely announcing support for 8004. The synergies between the two protocols will have a 1+1>2 effect.
For conservative players, one may consider focusing on high-cap projects benefiting from 8004; whereas for more aggressive players, close attention to low-cap projects in the table above and emerging projects may be necessary.
After all, the crypto market has not been dominated by a narrative driven by technology for a long time. Whether x402 and ERC-8004 are a flash in the pan or have a lasting impact remains to be seen, to be judged by the market.
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Debunking the AI Doomsday Myth: Why Establishment Inertia and the Software Wasteland Will Save Us
Editor's Note: Citrini7's cyberpunk-themed AI doomsday prophecy has sparked widespread discussion across the internet. However, this article presents a more pragmatic counter perspective. If Citrini envisions a digital tsunami instantly engulfing civilization, this author sees the resilient resistance of the human bureaucratic system, the profoundly flawed existing software ecosystem, and the long-overlooked cornerstone of heavy industry. This is a frontal clash between Silicon Valley fantasy and the iron law of reality, reminding us that the singularity may come, but it will never happen overnight.
The following is the original content:
Renowned market commentator Citrini7 recently published a captivating and widely circulated AI doomsday novel. While he acknowledges that the probability of some scenes occurring is extremely low, as someone who has witnessed multiple economic collapse prophecies, I want to challenge his views and present a more deterministic and optimistic future.
In 2007, people thought that against the backdrop of "peak oil," the United States' geopolitical status had come to an end; in 2008, they believed the dollar system was on the brink of collapse; in 2014, everyone thought AMD and NVIDIA were done for. Then ChatGPT emerged, and people thought Google was toast... Yet every time, existing institutions with deep-rooted inertia have proven to be far more resilient than onlookers imagined.
When Citrini talks about the fear of institutional turnover and rapid workforce displacement, he writes, "Even in fields we think rely on interpersonal relationships, cracks are showing. Take the real estate industry, where buyers have tolerated 5%-6% commissions for decades due to the information asymmetry between brokers and consumers..."
Seeing this, I couldn't help but chuckle. People have been proclaiming the "death of real estate agents" for 20 years now! This hardly requires any superintelligence; with Zillow, Redfin, or Opendoor, it's enough. But this example precisely proves the opposite of Citrini's view: although this workforce has long been deemed obsolete in the eyes of most, due to market inertia and regulatory capture, real estate agents' vitality is more tenacious than anyone's expectations a decade ago.
A few months ago, I just bought a house. The transaction process mandated that we hire a real estate agent, with lofty justifications. My buyer's agent made about $50,000 in this transaction, while his actual work — filling out forms and coordinating between multiple parties — amounted to no more than 10 hours, something I could have easily handled myself. The market will eventually move towards efficiency, providing fair pricing for labor, but this will be a long process.
I deeply understand the ways of inertia and change management: I once founded and sold a company whose core business was driving insurance brokerages from "manual service" to "software-driven." The iron rule I learned is: human societies in the real world are extremely complex, and things always take longer than you imagine — even when you account for this rule. This doesn't mean that the world won't undergo drastic changes, but rather that change will be more gradual, allowing us time to respond and adapt.
Recently, the software sector has seen a downturn as investors worry about the lack of moats in the backend systems of companies like Monday, Salesforce, Asana, making them easily replicable. Citrini and others believe that AI programming heralds the end of SaaS companies: one, products become homogenized, with zero profits, and two, jobs disappear.
But everyone overlooks one thing: the current state of these software products is simply terrible.
I'm qualified to say this because I've spent hundreds of thousands of dollars on Salesforce and Monday. Indeed, AI can enable competitors to replicate these products, but more importantly, AI can enable competitors to build better products. Stock price declines are not surprising: an industry relying on long-term lock-ins, lacking competitiveness, and filled with low-quality legacy incumbents is finally facing competition again.
From a broader perspective, almost all existing software is garbage, which is an undeniable fact. Every tool I've paid for is riddled with bugs; some software is so bad that I can't even pay for it (I've been unable to use Citibank's online transfer for the past three years); most web apps can't even get mobile and desktop responsiveness right; not a single product can fully deliver what you want. Silicon Valley darlings like Stripe and Linear only garner massive followings because they are not as disgustingly unusable as their competitors. If you ask a seasoned engineer, "Show me a truly perfect piece of software," all you'll get is prolonged silence and blank stares.
Here lies a profound truth: even as we approach a "software singularity," the human demand for software labor is nearly infinite. It's well known that the final few percentage points of perfection often require the most work. By this standard, almost every software product has at least a 100x improvement in complexity and features before reaching demand saturation.
I believe that most commentators who claim that the software industry is on the brink of extinction lack an intuitive understanding of software development. The software industry has been around for 50 years, and despite tremendous progress, it is always in a state of "not enough." As a programmer in 2020, my productivity matches that of hundreds of people in 1970, which is incredibly impressive leverage. However, there is still significant room for improvement. People underestimate the "Jevons Paradox": Efficiency improvements often lead to explosive growth in overall demand.
This does not mean that software engineering is an invincible job, but the industry's ability to absorb labor and its inertia far exceed imagination. The saturation process will be very slow, giving us enough time to adapt.
Of course, labor reallocation is inevitable, such as in the driving sector. As Citrini pointed out, many white-collar jobs will experience disruptions. For positions like real estate brokers that have long lost tangible value and rely solely on momentum for income, AI may be the final straw.
But our lifesaver lies in the fact that the United States has almost infinite potential and demand for reindustrialization. You may have heard of "reshoring," but it goes far beyond that. We have essentially lost the ability to manufacture the core building blocks of modern life: batteries, motors, small-scale semiconductors—the entire electricity supply chain is almost entirely dependent on overseas sources. What if there is a military conflict? What's even worse, did you know that China produces 90% of the world's synthetic ammonia? Once the supply is cut off, we can't even produce fertilizer and will face famine.
As long as you look to the physical world, you will find endless job opportunities that will benefit the country, create employment, and build essential infrastructure, all of which can receive bipartisan political support.
We have seen the economic and political winds shifting in this direction—discussions on reshoring, deep tech, and "American vitality." My prediction is that when AI impacts the white-collar sector, the path of least political resistance will be to fund large-scale reindustrialization, absorbing labor through a "giant employment project." Fortunately, the physical world does not have a "singularity"; it is constrained by friction.
We will rebuild bridges and roads. People will find that seeing tangible labor results is more fulfilling than spinning in the digital abstract world. The Salesforce senior product manager who lost a $180,000 salary may find a new job at the "California Seawater Desalination Plant" to end the 25-year drought. These facilities not only need to be built but also pursued with excellence and require long-term maintenance. As long as we are willing, the "Jevons Paradox" also applies to the physical world.
The goal of large-scale industrial engineering is abundance. The United States will once again achieve self-sufficiency, enabling large-scale, low-cost production. Moving beyond material scarcity is crucial: in the long run, if we do indeed lose a significant portion of white-collar jobs to AI, we must be able to maintain a high quality of life for the public. And as AI drives profit margins to zero, consumer goods will become extremely affordable, automatically fulfilling this objective.
My view is that different sectors of the economy will "take off" at different speeds, and the transformation in almost all areas will be slower than Citrini anticipates. To be clear, I am extremely bullish on AI and foresee a day when my own labor will be obsolete. But this will take time, and time gives us the opportunity to devise sound strategies.
At this point, preventing the kind of market collapse Citrini imagines is actually not difficult. The U.S. government's performance during the pandemic has demonstrated its proactive and decisive crisis response. If necessary, massive stimulus policies will quickly intervene. Although I am somewhat displeased by its inefficiency, that is not the focus. The focus is on safeguarding material prosperity in people's lives—a universal well-being that gives legitimacy to a nation and upholds the social contract, rather than stubbornly adhering to past accounting metrics or economic dogma.
If we can maintain sharpness and responsiveness in this slow but sure technological transformation, we will eventually emerge unscathed.
Source: Original Post Link

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