Coinbase has also unveiled a new system, Payments MCP, which integrates large language models with blockchain applications to undertake transactions by using natural language input.
The project represents another step towards integrating artificial intelligence and financial technology by Coinbase, enabling customers to make digital payments more conveniently and efficiently.
New protocol is the bridge between artificial intelligence and blockchain
Payments MCP, also known as Model Context Protocol, enables AI models like Claude, Gemini, and other intelligent agents to use their wallets for conducting wallet operations, fiat on-ramps, and transfers of stablecoins. The protocol allows the AI systems to access the same onchain tools that humans can access, such as creating wallets, transacting, and paying in stablecoins.
Its introduction is preceded by the establishment of the x402 Foundation, a collaboration between Coinbase and Cloudflare aimed at establishing standards for AI-based payment systems. Dan Kim, the vice president of business development and listings at Coinbase, and Erik Reppel, the executive in charge of engineering of the Coinbase Developer Platform, said that the innovation would facilitate agentic commerce, or financial transactions involving AI agents.
They emphasized the use of stablecoins as the most preferable way to pay for AI-driven payments due to their stability and ability to connect with onchain ecosystems.
How MCP operates payments
Coinbase described the Model Context Protocol as being simple and accessible. It enables users to engage with blockchain applications using AI that does not require the use of complicated developer installations or API connections. Any new user can create wallets and log in using only an email address.
The platform offers a visual dashboard that allows users to control their AI agent activities, set spending limits, and track transactions. It also features an x402 Bazaar Explorer that will enable traders to connect with accessible APIs and fiat on-ramps, as well as guest checkouts, in supported markets.
MCP Pay has been tested in several systems of AI, such as Claude Desktop, Claude Code, Gemini, Codex, and Cherry Studio.
Coinbase Develops Consumer Products
In another announcement, Coinbase introduced the Coinbase One card in the United States. The product will be included in the Coinbase One program, which costs $49.99 per year and offers up to 4% cash back on purchases made in Bitcoin. The card incurs no foreign transaction charges, and users can pay balances using their linked bank accounts or crypto to pay balances directly to Coinbase.
According to CEO Brian Armstrong, the new card was both attractive and extremely rewarding. According to Coinbase, the Bitcoin benefits are not listed on the IRS Form 1099-B upon receipt; however, when rewards are disposed of, they may be taxable.
Regulatory progress is still questionable
In the meantime, the development of the US “Clarity Act bill, the legislation to establish the cryptocurrency market structure, has been stuck in Congress following the failure of the bipartisan discussions. The differences between legislators have hampered further moves.
Coinbase CEO Armstrong was not discouraged by the setback, as the majority of the critical issues are already aligned, he said. He said there is still more to discuss, and that they hope to introduce the legislation by Thanksgiving.
