A very interesting analysis from Mizuho Bank just came out about what’s happening with X Money. Analysts Dan Dolev and Andrew Jenkins published a report where they basically say that Elon Musk’s move into payments could be much more disruptive than many think.

What catches the eye is how they see the potential of X Money as a true “superapp,” similar to what WeChat Pay or Alipay did in Asia. We’re talking about a platform that already has between 500 and 600 million monthly active users. If Musk manages to integrate messaging, banking deposits, and commercial transactions into one ecosystem, the game changes completely.

But here’s where it gets interesting: PayPal is in the crosshairs. Mizuho downgraded PYPL to neutral, arguing that both PayPal and Venmo face the most direct risk of substitution. Elon Musk already has experience in the payments sector, and that’s no small detail. If X Money positions itself as the financial infrastructure layer of the platform, PayPal would have a formidable competitor in peer-to-peer transfers and digital wallets.

Now, not everything is smooth sailing. There are two regulatory hurdles that could slow down the game. First, New York just proposed the CRYPTO (Protection, Trust, and Supervision of Cryptocurrency Regulation Act, which seeks to criminalize digital asset operations without a license. That significantly raises compliance costs for any future plans to integrate cryptocurrencies. Second, the Clarity law could limit the ability of non-bank platforms to offer yields, which would directly impact X Money’s plan to offer a 6% annual rate on cash balances.

Another thing X launched this week are “Cashtags,” which allow users to see stock and crypto data directly on their timeline. It seems like a strategic move to build a more comprehensive financial ecosystem.

In summary: Elon Musk is playing a long game in finance, and the U.S. payments market could be on the verge of real transformation. PayPal should be taking this seriously.