SoFi Technologies (SOFI) recently launched SoFiUSD, a bank-issued stablecoin that is now available for its members to buy, sell, hold, and convert directly within the SoFi app.
The launch is significant given it’s the first time a U.S. national bank-issued stablecoin has been made available on a banking platform.
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SoFiUSD is valued at 1:1 for U.S. dollars and operates on the Ethereum (ETHUSD) and Solana (SOLUSD) blockchains, with SoFi Bank maintaining all the assets to support the stablecoin.
Despite recent gains, SOFI shares are still down more than 35% versus their year-to-date high.
www.barchart.comSignificance of Stablecoin Announcement for SOFI Stock
SoFiUSD launch is bullish for SOFI stock, as it gives the fintech firm a first-mover advantage in a market that’s rapidly gaining regulatory legitimacy.
The GENIUS Act, which was signed into law last year, established a federal regulatory framework for payment stablecoins, giving federally chartered banks a clearer path to enter the market.
Total stablecoin market cap has already crossed $320 billion — and SoFi Technologies, backed by its federal bank charter, is uniquely positioned to capture a slice of that growing pie.
Future capabilities outlined by the company include 24/7 cross-border payment transfer, stablecoin-powered remittance infrastructure, and institutional trading access through crypto exchange team-ups.
All of these could meaningfully diversify and expand SOFI’s sales streams well beyond traditional lending.
SOFI Shares Are Attractively Priced At Current Levels
The stablecoin announcement arrives on top of an already compelling financial foundation.
In late April, SoFi posted its tenth consecutive quarter of GAAP profitability on a 41% year-over-year increase in adjusted net revenue to a record $1.1 billion.
Still, SOFI shares are currently trading at about 27x forward earnings — a huge discount to nearly 42x for fintech peer Robinhood (HOOD).
Crucially, SoFi Technologies ripped through its key moving averages (20-day and 50-day) on May 29, indicating bulls are now beginning to take back control from bears across multiple timeframes.
Wall Street Sees Further Upside in SoFi Technologies
Investors should also note that Wall Street firms currently see SOFI stock as undervalued.
According to Barchart, while the consensus rating on SoFi Technologies sits at “Hold,” the mean price target of $21.19 signals potential upside of another 17% from here.
www.barchart.com On the date of publication, Wajeeh Khan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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