> For the complete documentation index, see [llms.txt](https://docs.hunt.town/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.hunt.town/h402/how-paying-works.md).

# How Paying Works

h402 turns the HTTP `402 Payment Required` status into a real payment handshake, built on the **x402 v2** standard. The exchange is non-custodial: the caller's key signs locally and never leaves their machine.

## The handshake

1. **Call.** A normal request to the pinned provider. Free capabilities, and calls covered by credit, return immediately, with no payment step.
2. **Challenge.** If payment is required, the server returns `402` with the exact amount, the payee, and a short validity window.
3. **Sign.** The caller signs **an EIP-3009 authorization** over **Base USDC** for exactly the quoted amount. No funds move yet and no key is shared.
4. **Settle.** The caller retries with the signature attached. h402 verifies the signature, then calls the provider and pays it. Only after the provider returns a successful response does the authorization settle into h402's treasury through the Coinbase CDP facilitator, and the result returns. If the provider call fails, the authorization is never settled and the caller is not charged.

## Where the money goes

Two hops, deliberately separated:

* h402 pays the **upstream provider** from its own operating wallet when it makes the call: over x402 in Base USDC, or over Tempo MPP, depending on what the provider accepts.
* The **caller's** payment settles into h402's treasury afterwards, and only if the provider returned a successful response.

The caller therefore signs one authorization, in Base USDC, regardless of how the provider behind the capability is paid.

## Pricing and fees

A quoted price is the **provider's price plus h402's markup of 5%**. The markup is included in the quote, so the caller authorizes the final amount and there is nothing added afterwards.

Prices are denominated in USDC, which is what lets an agent reason about spend in dollars. Every payment is a one-shot, exact charge.

## Credits

Callers can hold **bonus credits**, issued today as onboarding grants, which are drawn down before any USDC is charged. Credits used on a failed call are returned.

## Properties that matter for agents

* **No charge for a failed call.** If the provider call fails, the caller's authorization is not settled, and any credits used are returned.
* **Bounded authorizations.** Each signature covers a single quoted amount and expires quickly, so a stale one cannot be replayed for more than it authorized.
* **No ambiguous charges.** A request whose payment state is unclear is not forwarded; it is reconciled rather than retried against another provider.
* **No double charges.** A retried call is not charged twice, and the client refuses a new price challenge on a retry instead of paying again.