Paypal Holdings (PYPL) plans to strengthen its foothold in the burgeoning cryptocurrency space by launching a stablecoin. Bloomberg reports that the payment giant is exploring the launch after evidence of a “PayPal Coin” was found inside the company’s iPhone App. PYPL shares fell 2.43% to close at $187.6 on January 7.
PayPal is a digital payments company that allows people to send and receive payments. Some of its notable solutions include PayPal, Paypal Credit, and Venmo. PayPal’s earnings report for Q4 2021 is scheduled for February 02, 2022.
PayPal Coin
The company has already confirmed it is working closely with the relevant regulators as part of the Stablecoin push. Hidden code and images in the iPhone app show that the company is working on a “PayPal Coin” backed by the U.S. dollar.
However, a PayPal spokeswoman insists that the images and codes seen inside the PayPal iPhone app resulted from the recent internal hackathon. The event brings engineers together to build new products, some of which never see a public release.
PayPal is one of the companies that have strengthened its footprint in the cryptocurrency space. The company has launched new features on its apps that allow people to buy and hold digital coins. It has also made it possible for people to use their crypto holdings to pay for purchases.
However, it is not the first technology company to explore the possibility of coming up with a stablecoin. Meta Platforms has been working on a stablecoin dubbed Diem. Visa has also allowed a stablecoin to settle a transaction on its network.
Stock Rating
Last week, BMO Capital analyst James Fotheringham upgraded PayPal stock to a Buy from a Hold with a $224 price target, implying 19.40% upside potential to current levels. According to the analyst, payment stocks are set up constructively for the year.
Consensus among analysts is a Strong Buy based on 27 Buys, 4 Holds, and 1 Sell. The average PayPal price target of $266.80 implies 42.22% upside potential to current levels.
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