Powering AI commerce with the new Agent Payments Protocol (Google)

Google announced the Agent Payments Protocol (AP2), an open standard designed to securely enable payments initiated by AI agents across platforms and payment types—including cards, bank transfers, and stablecoins. Developed with over 60 industry partners such as Coinbase, PayPal, and Mastercard, AP2 extends the Agent2Agent (A2A) protocol and builds a consistent, audit-friendly system for authorizing, authenticating, and attributing payments made by agents on behalf of users. AP2 relies on cryptographically-signed Mandates (Intent and Cart Mandates) as verifiable digital contracts to prove user consent, handle real-time purchases and delegated tasks, and establish clear accountability for transactions. The protocol is flexible enough to support emerging commerce models and integrates with web3 solutions through extensions like A2A x402. Google is inviting the broader industry to collaborate on AP2’s future and provides technical details and reference code in a public GitHub repository. [Source: Google]

PayPal to Integrate BTC, ETH, PYSD in P2P Payment Push (CoinTelegraph)

PayPal launched “PayPal Links” which lets users easily send or request money via personalized, one-time links that can be shared in any conversation or app. PayPal will soon allow users to send crypto-assets through its peer-to-peer (P2P) platform to PayPal, Venmo, and compatible global digital wallets. The update emphasizes user privacy (no U.S. Internal Revenue Service (IRS) 1099-K reporting on personal Venmo/PayPal transfers) and instant fund delivery, aiming to make sending money as easy as texting. This move comes alongside PayPal’s broader push for global wallet interoperability via the new PayPal World platform, designed to tie billions of wallets together and further scale its payments ecosystem. [Source: PayPal]

Rejecting the Banks’ Deposit Erosion Myth (Coinbase)

Coinbase published an article that argues that claims about stablecoins draining bank deposits and undermining lending are exaggerated and misleading. It states that there’s no solid evidence of stablecoin-induced deposit flight and that most usage of stablecoins is for payments rather than saving, meaning new stablecoins don’t pull dollars directly from banks. The article contends this narrative is fueled by banks seeking to protect their $187 billion annual payments fee revenue and maintain control over a dated, expensive payment ecosystem. The piece suggests that banks are not lacking deposits (noting the $3.3T parked as reserves at the Fed), and if they truly needed funds for lending, they would offer higher rates. [Source: Coinbase]

Central Bank Money as a Catalyst for Fungibility: The Case of Stablecoins (ECB)

The European Central Bank (ECB) published a paper that examines how different forms of money, particularly stablecoins, can achieve “fungibility”—the ability to be freely exchanged at equal value in retail payments—and argues that this requires three conditions: final settlement, interoperability across payment systems, and ready convertibility into central bank money. The authors find that tokenized funds and well-backed, regulated off-chain or on-chain collateralized stablecoins can become as fungible as bank deposits if these conditions are met, but algorithmic stablecoins cannot due to their lack of credible convertibility. Overall, the paper concludes that to ensure a unified and functional monetary system, future digital money designs must emphasize settlement finality, interoperability, and reliable conversion into central bank money. [Source: ECB]

Upcoming Speaking Engagements:

Stablecoin NYC 2025 (New York City on November 14-15) will be the definitive conference for exploring the future of digital money and intelligent payments. The event brings together founders, C-level executives, investors, policymakers, and developers for two immersive days of talks, panels, and networking. This be the place to be if you’re building, backing, or regulating the next wave of programmable finance. [Register here]

I produce a monthly digest of digital fiat currency (DFC) developments exclusively for the official sector (e.g., central banks, ministries of finance and international financial institution (e.g., the BIS, IMF, OECD, World Bank)) plus academics and firms that are active in the DFC space (commercial banks, technology providers, consultants, etc.). (DFCs include central bank digital currency (CBDC), stablecoins and tokenized deposits.) It goes out via email on the first business day of every month, and if you’re interested in being on the mailing list, please email me at john@kiffmeister.com.