Amazon (AMZN) may be looking to flex its muscle again and this time Etsy (ETSY) could be the target.

The Wall Street Journal reported that Amazon is exploring an online crafts marketplace that would challenge Etsy. The Journal says that Etsy sellers received invites last week offering them a sneak peek at Amazon's "Handmade."  

“We’re offering artisans like you a first peek at Handmade, a new marketplace for handcrafted goods,”  stated an email Amazon sent to artists, which was obtained by the Journal. 

However, Amazon did not release no further details on the debut of "Handmade."

Yahoo Finance’s Aaron Task believes this is a potential lethal threat to Etsy.

“If Amazon is coming in and they’re going directly against your big sellers. Etsy is a community and I’m sure a lot of people who sell there are loyal to it.  But at the end of the day if you are selling products you want to be at a place that you get the best opportunity and get the best benefits,” Task says.  "And Amazon has the fire power to be able offer Etsy sellers pretty much anything they want in order to get them to come on over.”

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The timing couldn’t be worse for Etsy. The ecommerce site for homemade crafts posted net loss $36.6 million for its first quarter. Etsy also posted revenue of $58.5 million, which was a 44% percent jump from a year earlier. Etsy shares have been hit hard since it first began trading as a public company in mid-April with shares down about 43% based on Friday's close. 

Etsy reported more than 1.4 million active sellers and 20.8 million active buyers at the end of the first quarter of this year.  That pales in comparison to  Amazon, which has an estimated 278 million active accounts.

Task says even though Amazon may not have a lot to gain by launching rival site to Etsy, when you’re as big as Amazon you want to own everything.

“This is them really saying, ‘Oh, you think you can play in this world -- boom -- like we‘re just going to take you out.’ That might not be what happens and that might not be Amazon’s strategy, but it is definitely a major shot across Etsy’s bow, for sure,” he points out.  “And Jeff Bezos and company at Amazon -- they have incredible fire power--incredible loyalty from the Prime users.  And I just think it’s going to be very difficult for anyone to compete with them.”