Block Agrees to $764 Million DOJ Settlement as Bitcoin Profit Falls 50%
Jack Dorsey's payments company Block has agreed in principle to pay $764 million to resolve a U.S. Department of Justice investigation into its anti-money-laundering controls, a proposed settlement that exceeds the company's $566 million net profit reported for the third quarter.
The agreement was reached in October and disclosed in a November 3 filing with the U.S. Securities and Exchange Commission, reviewed by CoinDesk. Under the proposed resolution, a criminal charge alleging that Block failed to maintain an effective anti-money-laundering program under the Bank Secrecy Act would be deferred for three years.
The settlement carries a gross monetary obligation of approximately $964 million. After credits for payments made under earlier regulatory settlements, the amount falls to $764 million. Block said it has already set aside funds to cover the reduced amount.
DOJ Investigation Follows Cash App Compliance Allegations
The investigation began in 2023, when the Justice Department and SEC examined Block's compliance practices and related disclosures following allegations raised by short seller Hindenburg Research.
Hindenburg alleged that Cash App overstated its user numbers by including duplicate and fraudulent accounts. The report also claimed that inadequate identity verification procedures allowed criminals to use the platform for scams, money laundering and other illicit transactions.
Block rejected the allegations, describing the findings as inaccurate and misleading. The SEC closed its separate investigation in March without recommending enforcement action.
New York Regulator Previously Fined Block $40 Million
Block faced a separate regulatory penalty in April 2025, when New York's financial regulator imposed a $40 million fine over serious weaknesses in the company's compliance systems.
The regulator found that a backlog of suspicious transaction alerts increased from approximately 18,000 in 2018 to more than 169,000 by 2020. It also identified a weakness in one of Block's screening systems, which did not automatically prevent bitcoin transfers to wallets associated with terrorism financing until their exposure exceeded 10%.
Block's Bitcoin Gross Profit Drops 50%
The proposed DOJ settlement comes as Block reports weaker earnings from its bitcoin-related business on Cash App. Bitcoin ecosystem gross profit declined 50% year over year to $52 million in the third quarter, compared with $104 million in the same period a year earlier.
Revenue from the bitcoin ecosystem also fell 11% to $1.8 billion. Block attributed the decline in gross profit primarily to its decision to lower fees on certain bitcoin transactions.
Despite the weaker bitcoin performance, the company's broader business continued to expand. Block's total gross profit increased 22% to $3.24 billion, supported by stronger activity in Cash App's lending and payments operations.
The proposed $764 million resolution would represent a substantial financial obligation for Block, while the latest quarterly figures show a sharp decline in profitability from its bitcoin ecosystem. At the same time, growth in lending and payments helped lift gross profit across the wider business.
source: coindesk
Writer: Ethan Collins
Crypto Journalist
Ethan Collins reports on developments across the cryptocurrency and blockchain sector. His work covers market movements, protocol updates, regulatory changes, and emerging trends in digital assets.
He focuses on presenting complex topics in a clear and accessible manner for a broad readership.
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