Google unveiled the Agent Payments Protocol (AP2) and announced a partnership with Coinbase to enable stablecoin payments, primarily USDC, in artificial intelligence applications. The initiative, backed by more than 60 entities, aims to automate and secure micropayments initiated by AI agents, with direct impact on developers, merchants, and payment infrastructure providers.
AP2 seeks to standardize and simplify payment integration in agentic applications as an open-source project, bringing stablecoin liquidity to AI flows that require real-time verification and execution.
What AP2 Introduces and Coinbase’s Role
AP2 introduces “Mandates”, cryptographically signed digital contracts to verify user intent and authorize automated payments. The protocol supports traditional payment methods and stablecoins, enabling AI agents to execute verifiable transactions without human intervention. As an open-source protocol, it aims to standardize payment orchestration and reduce technical complexity for developers.
Coinbase brings USDC settlement through Base, its Ethereum Layer-2, designed for faster and cheaper transactions. This infrastructure enables millisecond micropayments, with costs reduced to fractions of a cent compared to the typical 2–3% card fees. In parallel, Shopify integrated USDC payments with Coinbase and Stripe across 34 countries, where some merchants can access refunds and up to 0.5% cashback in the U.S.
The AP2 launch includes collaborations with the Ethereum Foundation, Dell, Mysten Labs, and more than 60 partners, signaling a multi-sector approach that integrates hardware, infrastructure layers, and protocol development.
Implications for Product, Liquidity, and Compliance
The reduction of operating costs makes pay-per-use models viable for APIs and AI services. New product vectors emerge, such as autonomous agents purchasing data or services in real time using USDC as a settlement medium, creating more granular and programmable user experiences.
In terms of compliance and regulation, adoption runs alongside policy shifts. The GENIUS Act requires stablecoin issuers with more than $10 billion in market cap to come under federal supervision within 360 days, banning issuers from paying interest but allowing exchanges to offer rewards.
Several operational risks persist, including dependence on Layer-2 networks, custody requirements, and potential smart contract vulnerabilities. On interoperability, Coinbase is exploring expanded Base capabilities, including the potential issuance of a network token, which could reshape its revenue and liquidity models.
AP2 builds a technical bridge between AI agents and stablecoin payments, with support from over 60 entities and key roles from Coinbase and the Ethereum Foundation. This milestone arrives as the regulatory framework —including the GENIUS Act and its 360-day compliance deadline— redefines supervision and oversight obligations for the ecosystem.
