In a move that could fundamentally reshape the global financial landscape, payment processor Stripe is exploring a potential acquisition of its long-time rival PayPal, according to reports from Bloomberg.
The news, which broke Tuesday, indicates that Stripe has expressed “preliminary interest” in purchasing either the entirety of PayPal or a significant portion of its assets. While talks are in the early stages and no deal is certain, the prospect marks a dramatic role reversal: Stripe, the private upstart, eyeing the pioneer that once defined digital payments.
The reports surfaced as Stripe announced it has reached a staggering $159 billion valuation. The company confirmed it has signed agreements with major investors—including Thrive Capital, Coatue, and a16z—to facilitate a tender offer. This deal provides liquidity for current and former employees, allowing them to sell shares in one of the world’s most valuable private entities.
By contrast, PayPal has faced a difficult period. Despite its legacy as the architect of the digital wallet, the company has seen its market share eroded by newer, more developer-friendly platforms like Stripe and mobile-first solutions like Apple Pay. PayPal’s stock (PYPL) has tumbled nearly 40% over the last year, leaving it with a market capitalization of approximately $42 billion—a fraction of Stripe’s latest private valuation.
Industry analysts suggest the acquisition could be driven by a shared vision for the future of money: stablecoins.
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Stripe’s Momentum: Last year, Stripe acquired the stablecoin platform Bridge, which recently received conditional approval from the OCC to operate as a federally chartered national trust bank.
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PayPal’s Foundation: PayPal launched its own stablecoin, PYUSD, in 2023. As of this month, PYUSD’s market capitalization sits at $3.8 billion, making it a leader in the regulated digital asset space.
“Stripe is building the plumbing for the internet economy, and PayPal has the consumer network,” noted one market analyst. “Merging the two could create a powerhouse capable of dominating both traditional e-commerce and the emerging Web3 payment sector.”
PayPal’s stock surged more than 6% on Tuesday following the reports, as investors speculated on a potential exit or a strategic breakup. The company is also undergoing a leadership transition, with Enrique Lores set to take over as CEO on March 1.
Stripe and PayPal have both declined to comment officially on the acquisition rumors.
