Stripe Reaches $159 Billion Valuation as Acquisition Interest in PayPal Emerges
Stripe Inc., the privately held financial technology company, has achieved a $159 billion valuation through an employee tender offer while simultaneously expressing preliminary interest in acquiring all or parts of PayPal Holdings Inc.
The dual developments, announced on February 24, 2026, highlight Stripe’s expanding footprint in digital payments as it reported $1.9 trillion in total payment volume for 2025 and continued profitability amid aggressive product investment and acquisitions.
PayPal’s stock surged nearly 7 percent following the acquisition report, though both companies declined to comment on the speculative discussions, which remain in early stages with no certainty of a transaction.
Financial Performance and Valuation Milestone
Stripe’s $159 billion valuation represents a significant increase from the $106.7 billion valuation secured in 2024 and the $91.5 billion valuation from one year ago. The valuation was established through a secondary stock sale providing liquidity to current and former employees, with investors including Thrive Capital, Coatue, and Andreessen Horowitz participating alongside Stripe’s own share repurchases.
The company processed $1.9 trillion in total payment volume during 2025, marking a 34 percent increase from the previous year. Stripe reported maintaining profitability throughout the year while continuing substantial investment in product development and strategic acquisitions. The company’s revenue suite is projected to reach an annual run rate of $1 billion in 2026.
President John Collison indicated that Stripe has no imminent plans for an initial public offering, stating that a public market debut would divert focus from product development and business growth objectives.
Acquisition Discussions and Strategic Rationale
Stripe has expressed preliminary interest in acquiring all or portions of PayPal’s business, though deliberations remain at an early stage. The potential transaction would unite two major payment processors with combined significant market presence in global e-commerce.
A potential combination presents strategic logic, as Stripe possesses arguably the strongest developer and merchant-centric payments infrastructure globally but lacks the large-scale authenticated consumer network and brand that PayPal has developed over decades. Building such a consumer presence independently would require years of investment and tens of billions of dollars without guaranteed success.
Combining Stripe’s existing e-commerce volume through partnerships such as Shopify Inc. with PayPal’s consumer network could enable the combined entity to transact close to 50 percent of global e-commerce volumes at a time when markets are increasingly focused on agentic commerce and AI-driven purchasing decisions.
PayPal’s Market Position and Challenges
PayPal has experienced significant market pressure in recent years, with shares declining more than 80 percent from their 2021 all-time highs. The company’s stock has fallen over 19 percent since the beginning of 2026 and lost nearly one-third of its value during 2025.
The company faces slowing growth and intensifying competition from technology entrants including Apple Inc. and Alphabet Inc. 's Google in the digital payments space. PayPal’s fourth-quarter earnings and revenue both missed analyst estimates, with payment transaction volume growth continuing to decelerate.
Earlier in February 2026, PayPal’s board removed CEO Alex Chriss, citing that the “speed of transformation and execution” had fallen short of expectations after Chriss delivered a profit outlook substantially below Wall Street estimates. The board appointed Chair Enrique Lores, who concurrently serves as CEO of HP Inc. , as president and chief executive effective March 1, 2026, with David Dorman assuming the board chair position.
Cryptocurrency and Stablecoin Expansion
Both companies have demonstrated increasing commitment to cryptocurrency and stablecoin infrastructure, positioning them for competition in blockchain-based payments.
Stripe has accelerated its crypto expansion through multiple initiatives. In 2024, it acquired Bridge, a stablecoin orchestration platform, for approximately $1.1 billion. On February 17, 2026, Bridge received conditional approval from the U.S. Office of the Comptroller of the Currency (OCC) to organize a federally chartered national trust bank, enabling it to issue stablecoins, provide digital asset custody, manage stablecoin reserves, and offer orchestration services under direct federal supervision upon final approval.
Stripe has also acquired crypto wallet provider Privy and unveiled its own blockchain, Tempo, developed in collaboration with crypto venture firm Paradigm. Tempo is designed specifically for stablecoin payments to avoid fee spikes and processing delays during periods of high network traffic.
The stablecoin payment market doubled to approximately $400 billion in 2025, with Stripe estimating that roughly 60 percent represents business-to-business transactions. Bridge’s volume more than quadrupled during the same period.
PayPal launched its dollar-backed stablecoin PYUSD in 2023 through issuer Paxos, with the token reaching a market capitalization of approximately $4 billion. In December 2025, Paxos received a federal banking charter from the OCC, positioning PYUSD as the largest dollar stablecoin issued under federal regulatory oversight. Nearly 85 percent of PayPal survey respondents recently indicated expectations that cryptocurrency payments will become commonplace within five years.
Regulatory Developments
The regulatory environment for stablecoins has evolved significantly with the enactment of the GENIUS Act in July 2025, establishing the first comprehensive federal framework for payment stablecoin issuers in the United States. The legislation requires issuers to maintain one-to-one reserves with U.S. dollars or highly liquid assets and comply with monthly public attestation requirements.
Bridge’s conditional approval from the OCC for a national trust bank charter reflects this evolving regulatory landscape, joining several other digital asset firms that have sought or received similar charters in recent months.
Frequently Asked Questions
Is Stripe definitely acquiring PayPal?
No. Discussions remain in early stages, and both companies have declined to comment on the report. No formal offer has been announced, and there is no certainty that any transaction will occur. The potential acquisition could involve all or parts of PayPal’s business.
How does Stripe’s valuation compare to PayPal’s market capitalization?
Stripe’s $159 billion valuation substantially exceeds PayPal’s current market capitalization of approximately $43 billion. This valuation gap reflects Stripe’s growth trajectory and PayPal’s recent market struggles, though PayPal maintains a larger consumer user base and established brand recognition.
What are the key crypto initiatives at Stripe and PayPal?
Stripe has acquired Bridge and Privy, received conditional OCC approval for Bridge to form a national trust bank, and developed the Tempo blockchain with Paradigm. PayPal launched the PYUSD stablecoin through Paxos, which received its own OCC banking charter in December 2025, positioning PYUSD as the largest federally regulated dollar stablecoin.
Why might Stripe consider acquiring PayPal despite PayPal’s recent challenges?
Stripe could benefit from acquiring PayPal’s large-scale authenticated consumer network and brand, which would be costly and time-consuming to build independently. A combination could create a payments entity processing close to half of global e-commerce volumes and position both companies strongly for emerging AI-driven commerce applications.
What is Stripe’s stance on going public?
Stripe co-founder and president John Collison stated that the company has no imminent plans for an initial public offering, as an IPO would divert focus from product development and business growth objectives. The company remains privately held while providing liquidity to employees through periodic tender offers.