PayPal shares sank greater than 5% on Wednesday after Bernstein analysts downgraded the inventory to carry, citing fears that the corporate faces a broad array of dangers.

“PayPal’s positioning as a number one digital pockets in an more and more digital world is tough to not acknowledge (one of many causes we upgraded the inventory 2yrs in the past),” the analysts wrote. “That stated, we imagine change is accelerating, and PayPal now dangers getting disrupted vs. being a disruptor.”

Bernstein analysts are involved concerning the rising focus of e-commerce round huge platforms like Shopify and Amazon, which account for 32% of the U.S. e-commerce market.

Shopify is “rising as an unassailable competitor” in PayPal’s core small and medium-sized enterprise market, the analysts stated, and poses an additional threat because it launches its personal funds platform. Likewise, Amazon is about to start accepting PayPal’s Venmo in its place fee in 2022, however Bernstein believes Venmo is at the moment “severely under-monetized.”

The analysts are additional involved that PayPal is “underneath siege by a thousand cuts” from different fee options starting from Apple Pay and Square to purchase now, pay later choices from Affirm and Klarna, that are rising between 50% and 100% yearly, the analysts wrote.

“We imagine Sq.’s pending acquisition of Afterpay is recreation altering and accelerates its efforts in direction of changing into a dominant funds ecosystem within the U.S.,” the analysts wrote, noting that PayPal faces aggressive dangers as Sq. strikes on-line and additional competes towards PayPal with Money App.

“Whereas PayPal is actively investing and evolving, it merely has extra turf to defend vs. friends in our view,” they wrote.