Mizuho Bank: Musk's X Money may disrupt the US payments market and impact PayPal.

ChainCatcher reports that, according to The Block, Mizuho Bank research analysts released a report on Thursday stating that X Money, the financial feature launched by Elon Musk's X platform, has the potential to disrupt the US payments industry, but its cryptocurrency integration plans may face regulatory obstacles. Mizuho analysts Dan Dolev and Andrew Jenkins wrote in a client report that X Money is positioned as the financial infrastructure layer of the X platform, aiming to integrate instant messaging, bank deposits, and commercial transaction functions, similar to the "super app" model of WeChat Pay or Alipay. With X platform's 500-600 million monthly active users and Musk's background in the payments industry as a co-founder of PayPal, X Money has the potential to disrupt the US payments industry. From a regulatory perspective, analysts point to two potential obstacles: First, New York State's recently proposed CRYPTO (Cryptocurrency Regulatory Protection, Trust, and Oversight Act) aims to criminalize unlicensed virtual currency businesses operating in the state, raising the compliance threshold for X's future crypto integration plans. Second, the Clarity Act may restrict the ability of non-bank financial platforms to offer returns to users, potentially hindering X Money's proposed 6% annualized cash balance yield plan. Analysts say the timing of this yield product's launch is "particularly sensitive." Mizuho also downgraded PayPal (PYPL) stock to "neutral," noting that PayPal and its Venmo app face the most direct substitution risk because X is targeting the same peer-to-peer transfer and digital wallet entry points. This week, X also launched a new "Cashtags" feature, allowing users to directly view financial data for stocks and cryptocurrencies within a timeline.