The x402 payment ecosystem is ushering in its own "Taobao moment".

Author: Yue Xiaoyu; Source: X, @yuexiaoyu111

x402 payment ecosystem is ushering in its own "Taobao moment"!

1. What is the most important thing in building a payment ecosystem?

It is actually the merchant ecosystem, that is, you need to enrich the supply side first in order to attract more demand.

Analogous to the emergence of Alipay, the Taobao platform existed first, and Alipay was built to solve the payment problem.

In other words, electronic payment was rapidly popularized because of the emergence and prosperity of e-commerce platforms.

The popularity of Alipay is not because of its superior technology, but because Taobao's merchant ecosystem (supply) drove demand.

2. AI-native payment also faces the challenge of a cold start

The previously popular x402 is a very simple and pure AI-native payment protocol, mainly solving the problem of AI payment.

In developing its ecosystem, x402 faces the same challenges as when electronic payments first emerged: Where is the market? Who are the merchants? Who will supply the data? Now, the largest seller has appeared in the x402 payment ecosystem: the decentralized data provider Switchboard. Switchboard is an oracle and is currently the first and only decentralized data source in the x402 ecosystem that supports pay-per-use access. Simply put, x402 allows AI Agents to easily buy data, and Switchboard is the seller of high-quality, real-time data, using x402 to collect micropayments. 3. Switchboard is the "Taobao moment" of the x402 payment ecosystem! Just as Taobao first gathered a massive number of merchants, Switchboard first provided a rich and reliable supply of paid data, attracting the first batch of AI Agents to test it. Switchboard uses x402 to list all data sources for sale: AI Agent sends a request → Server returns a 402 error → Agent automatically makes on-chain payments → Data is obtained instantly. This forms a flywheel: Switchboard's supply attracts AI Agents (demand) → Transaction volume increases → More sellers follow x402 → Ecosystem prosperity. 4. In a payment ecosystem, supply must come first! Building a payment ecosystem requires first creating a marketplace like Taobao, enriching merchants and activating supply. x402 + Switchboard perfectly replicates Alipay + Taobao: the protocol provides the tools, and the supply side (data sellers) provides the market. a16z estimates the x402 market to reach $30T, and Switchboard, as a pioneering data marketplace, has the opportunity to capture a huge share of the data layer. We can continue to follow the latest developments in the x402 ecosystem.