Is Know Your Agent (KYA) Really Necessary?

Is “Know Your Agent” (KYA) Really Necessary? The tale of an Orphan Signal

Short Blog | June 2026

A new category of startup has emerged around “Know Your Agent” (KYA) — the idea that merchants and payment platforms need a framework to verify the identity, authority, and auditability of AI agents acting on behalf of consumers. PYMNTS has covered the space extensively, and KnowYourAgent.xyz is already pitching merchants on “identity, policy controls, and evidence for every AI-agent transaction at checkout.” The framing is intuitive: if a bot is buying something, shouldn’t you know who sent it?

I want to push back — not on the problem, but on whether KYA, as a standalone service category, is the right solution.

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MPP (and X402) – Solving the Internet’s “Original Sin”

Yes another agentic payment acronym. This one is important enough to remember. Where AP2 and ACP address agents acting on behalf of humans, X402 and MPP are about agents paying agents. My friend Simon Taylor just put together one of his all-time best posts on MPP and The Intention Layer. Today’s blog is a follow-up with a bit more of a comparison, and why this is a big deal from a payment and economic perspective. My key takeaways from Simon’s post

  • The “Skinny Master Account”: Taylor suggests that humans will grant “intent” (a budget and a goal) to an agent. MPP’s Session model perfectly mirrors this: a human “locks” $50 into a session (the intention), and the agent autonomously spends it in sub-cent increments (the execution).
  • The Substrate of AI: Taylor points out that AI thrives on Structured Text (Markdown). Ironically, legacy finance (ISO 8583, NACHA files) is essentially structured text. MPP acts as the “translator” between the agent’s markdown-based intentions and the rigid requirements of the global banking system.
  • The Outcome: The winner won’t be the protocol that is “most decentralized,” but the one that most effectively manages Trust and Permissioning. Stripe and Visa, as the incumbent trust-layers of the internet, are better positioned to solve the “Agentic Spend” problem than a pure-crypto protocol.

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Stablecoin Scenarios

Summary

The digital asset ecosystem has graduated from a decade of speculative experimentation to a decisive phase of infrastructure modernization. For fifteen years, the discourse surrounding blockchain technology has been dominated by the volatility of crypto-assets, effectively obscuring the underlying utility of the technology. That era has concluded. We are now witnessing the industrialization of the sector, where stablecoins have emerged not as a new form of money, but as a fundamental settlement innovation (see blog).

The GENIUS Act has provided the regulatory clarity required to transition stablecoins from the periphery of finance to its very core. This legislative milestone has catalyzed a geopolitical shockwave, prompting European finance ministers to declare U.S. stablecoins a greater threat to monetary sovereignty than trade tariffs. But while the Genius act codified “trust” in an instrument (reducing settlement risk to stablecoin issuer balance sheet), it does not address disputes and broader governance issues associated with managing participants across diverse processes and regulatory regimes.

The maturation of stablecoins is not a revolution that overthrows established banks and payments system; it is an evolution that upgrades it. The rails are being replaced while the train is moving, and those who understand the mechanics of the new tracks will determine the destination of global capital.

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V/MA Settlement – Tiered Acceptance

Quick Take on WSJ – V/MA Near Deal w/ Merchants

Merchants have long expressed frustration over card costs, but it’s critical to separate signal from noise. Their issue isn’t with network fees—those average just 5 to 7 basis points and fund the global infrastructure that securely moves trillions. The real pressure point is interchange, often 250 basis points or more for premium rewards cards. That imbalance has shaped years of litigation, and now a potential reset is emerging.

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X402 Foundation

Short Blog

The x402 Foundation was publicly announced last week on September 23, 2025, as a joint initiative between Coinbase and Cloudflare. This effort aims to solve the governance issue in agentic. The design COULD SOLVE the governance issues outlined in Governance in Payments as well as last month’s Agentic Commerce Economics and Governance. As a refresh, my position is that monetization/governance is the Gordian knot preventing AI from moving to next stage of growth. 

While Google’s AP2 suffers from a dependency on settlement governance and the inability to expand trust beyond their own domain (see AP2 blog), x402 is just a standard that handles payment terms negotiations between two APIs (both price and method). The foundation turns x402 into a “network) with an operational model, active governance and economics. My example is that an existing customer would have payment managed with a current card on file and the merchant owning risk, whereas a new customer (or new machine request) could agree on a non-refundable stablecoin payment.  

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Governance in Payments

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Long blog – Paid Content

Executive Summary

I’ve been writing about governance, trust, transaction costs and payments for a long time. In my view THE KEY to understanding how stablecoins, agentic, DeFi, Open Banking, tokenization and other payment innovations is governance. I seem to be the only one writing about it, so I don’t see a reason to stop now. Governance is the BIGGEST competitive moat for Visa and Mastercard, and its also the heart of their biggest break out growth opportunity. If you thought AI was transformational, radically reducing transaction costs (TCE per Nobel work of Ronald Coase) will dwarf it. In fact the monetization of AI is a Gordian knot of governance issues (see Agentic Commerce and Governance). 

Today I’m expanding on “value exchange” governance with 5 core themes.

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ApplePay’s 11th birthday in iOS 26 – What’s New?

ApplePay turns 11 yrs old this month, a wallet that has gone from 0 to 84 countries and 11,000 banks. Hard to believe, my blog was the first to break the news of ApplePay in iPhone 6 back in 2014.  Back then I was on the advisory board of Money2020, and asked M2020 co-founder Johnathan Weiner to hold a place in the agenda for Apple Pay. September rolled around and we still had an “empty” slot, I told him to trust me. It worked out well, as Apple finally rolled it out on September 9th 2014.  There was so much innovation in the initial wallet from tokenization, provisioning, credentials in the secure enclave, … and of course the game of chicken Apple played with Issuers on their 15bs (in US, 7bps in EU see story). 

I just installed iOS 26 this morning, so what’s new in iOS 26 w/ ApplePay

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Pay by Bank Double Whammy

I’ve never been a fan of “Pay by Bank.” It’s a solution in search of a problem, especially when compared to the efficiency of debit cards and the global reach of Visa Direct. Now, two major developments have dealt a significant blow to the already weak business case for this payment method.

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Durbin Debit Fees Reduced

In a significant ruling on yesterday (Aug 7)) U.S. District Court Judge Daniel Traynor struck down “swipe fees” cap that non-exempt banks can charge merchants for debit card transactions. The decision found that the Federal Reserve had exceeded its authority by allowing these fees to be higher than intended by law (ie include provisions for “fraud”).

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