Shares of PayPal (PYPL) are trading slightly higher at the time of writing after Fortune reported that the digital payments platform is teaming up with Anchorage Digital to promote its stablecoin, PYUSD. This will be done by offering rewards to institutional investors as an incentive, even though there are legal and regulatory questions about stablecoin interest payments.
Anchorage Digital is the only U.S. crypto firm with a federal bank charter, which makes it different from other companies that operate under state licenses or without regulation. PayPal is hoping that Anchorage Digital will help PYUSD gain traction, which has been struggling and has a market cap of under $1 billion. For reference, Tether (USDT-USD), which is the most popular stablecoin, has a market value of $117 billion.
Although there are concerns about regulations, Anchorage Digital says the rewards aren’t considered securities and aren’t subject to U.S. banking rules. As a result, payouts will be handled by a Cayman Islands entity that will allow them to avoid regulatory oversight. This move is seen as a way to deal with unclear rules while PayPal continues to grow its presence in the crypto space.
Is PYPL a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on PYPL stock based on 14 Buys, 17 Holds, and zero Sells assigned in the past three months, as indicated by the graphic below. After a 16% rally in its share price over the past year, the average PYPL price target of $74.92 per share implies 4.03% upside potential.
