Mind Network has launched its x402z testnet, pioneering the use of Fully Homomorphic Encryption (FHE) for confidential AI agent payments. This development, announced on March 15, 2025, introduces a new infrastructure that allows autonomous AI systems to conduct financial transactions while maintaining business confidentiality. The testnet is the first practical application of FHE for on-chain AI payments, addressing concerns about transparency affecting competitive AI operations. The x402z testnet utilizes Mind Network's proprietary FHE validation network, enabling transaction verification without exposing sensitive data. It also implements the ERC-7984 token standard, developed with Zama, to support encrypted asset transfers between autonomous systems. Participants can access the testnet by connecting compatible wallets to Mind Network's platform, allowing them to simulate AI payment scenarios. This initiative marks a significant step in balancing transaction verification with data privacy in decentralized systems.