Block Inc.
Block, Inc., formerly Square, Inc., is an American technology company and financial services provider serving consumers and merchants. Founded in 2009 by Jack Dorsey, it is the United States market leader in point-of-sale systems. As of 2024 it had 57 million users and four million sellers, processing 241 billion dollars in payments annually.
| Block, Inc. | |
|---|---|
| Type | Public |
| Traded as | NYSE: XYZ |
| Industry | Financial technology, payments |
| Founded | 2009, as Square, Inc. |
| Founder | Jack Dorsey, Jim McKelvey |
| Headquarters | Oakland, California, United States |
| Area served | United States, Canada, Japan, Australia, United Kingdom, Ireland and other markets |
| Key people | Jack Dorsey (block head and chairman) |
| Products | Square point-of-sale, Cash App, Afterpay, Bitkey, Proto |
| Services | Payment processing, merchant banking, consumer finance, music streaming |
| Subsidiaries | Square, Cash App, Afterpay, Tidal, Bitkey, Proto |
| Website | block.xyz |
The company's first product, Square, launched in 2009 as a point-of-sale system allowing sellers to accept card payments and manage bookings, e-commerce, inventory, payroll, banking and business lending. Its portfolio also includes Cash App, a consumer digital wallet introduced in 2013 through which users send, receive, save and borrow money, use a debit card, invest in stocks and bitcoin and file taxes; Afterpay, a buy now, pay later business; Bitkey, a self-custody bitcoin wallet; Proto, a bitcoin mining system; and Tidal, a music streaming service.
History
Origins, 2009
The idea for Square came to Jack Dorsey in 2009 when his friend Jim McKelvey was unable to complete a 2,000 dollar sale of glass faucets and fittings because he could not accept credit cards. Dorsey, who had also co-founded Twitter, and McKelvey began developing the company from a small office in St. Louis. The name derives from the square-shaped card reader.
The product addressed a specific market failure. Card acceptance had traditionally required a merchant account, underwriting, contracts and dedicated terminals, costs that excluded very small sellers. Square supplied a free reader that plugged into a mobile phone and charged a single flat percentage, making card acceptance viable for market traders, cab drivers and one-person businesses.
Early growth, 2010 to 2014
According to Forbes, the company tested its payment method with 50,000 merchants in the summer of 2010 and reported a chargeback rate below 0.05 per cent. By February 2011 it was valued at approximately 240 million dollars and signing up 100,000 merchants a month, and in April it secured an investment from Visa. By October 2011 it was processing about two billion dollars a year at 2.75 per cent per transaction.
In 2012 Starbucks announced a partnership to use Square technology to accept payments and reportedly invested 25 million dollars. Annual payment volume was then around six billion dollars. The Starbucks arrangement proved unprofitable and was wound down, but it established the company's credibility with larger merchants.
Cash App launched in 2013 as a peer-to-peer payment service. In October 2014 the company added payroll to its payment system, following a merchant cash advance product, customer feedback tools and invoicing.
Flotation and expansion, 2015 to 2020
The company reported processing about 23.8 billion dollars of payment volume in 2014. It went public in 2015 at nine dollars a share, giving a market capitalisation of 2.9 billion dollars, a valuation below its last private round and widely treated at the time as a disappointment.
Cash App became the more significant business. Vox reported in 2018 that more than seven million people had used the app in December 2017 and that it was the leading free finance application in Apple's United States App Store, ahead of PayPal and Venmo. Its growth was driven by direct deposit, stock and bitcoin investing and, during the pandemic, by government stimulus payments.
In October 2020 the company placed approximately one per cent of total assets, 50 million dollars, into bitcoin, citing its potential to become a more ubiquitous currency, and added a further 3,318 bitcoin in February 2021 for about 170 million dollars, bringing holdings to roughly 8,027 bitcoin.
Renaming and acquisitions, 2021 onward
On 2 March 2021 Square agreed to acquire a majority stake in Tidal for 297 million dollars in cash and stock, with Jay-Z joining the board and existing artist shareholders retaining stakes. The purchase of a music streaming service by a payments company was widely questioned; the stated rationale was to build tools allowing musicians to earn directly from audiences.
On 1 December 2021 the company announced that it would become Block, Inc. from 10 December, shortly after Dorsey resigned as chief executive of Twitter. The name was intended to encompass the group's several businesses and to evoke blockchain technology.
On 16 December, less than a week after the rebrand, H&R Block sued for trademark infringement, claiming that the name would confuse customers by appropriating its own brand. The parties jointly dismissed the suit in April 2023.
Block completed the acquisition of the Australian buy now, pay later lender Afterpay on 31 January 2022 in a transaction originally valued at 29 billion dollars, substantially less by completion following the fall in technology valuations.
Controversies
Hindenburg Research report
In March 2023 Hindenburg Research published a report alleging that Block had overstated its user numbers by failing to account adequately for fake and duplicate accounts, that Cash App's compliance controls were inadequate, and that the platform facilitated fraud. Hindenburg disclosed a short position. Block rejected the report as factually inaccurate and misleading and said it would work with regulators and explore legal action. The share price fell sharply on publication.
Compliance and anti-money laundering
Regulatory scrutiny of Cash App's controls intensified subsequently. In 2025 Block agreed to pay 80 million dollars to a group of state financial regulators over deficiencies in its Bank Secrecy Act and anti-money laundering programme, and separately reached a settlement with the New York Department of Financial Services involving a 40 million dollar penalty, relating to inadequate customer due diligence and transaction monitoring, including for cryptocurrency activity. The company stated that it had substantially invested in its compliance function.
Fraud on Cash App
Consumer advocates and legislators have criticised the level of fraud on Cash App and the difficulty users face obtaining redress, since peer-to-peer transfers are generally irreversible and authorised push payment fraud falls outside the protections applying to card transactions. The Consumer Financial Protection Bureau examined the treatment of disputed transactions across the sector, and Block agreed in 2025 to provide redress to affected Cash App users.
Bitcoin strategy
Dorsey's commitment to bitcoin, expressed through corporate holdings, the Bitkey wallet, the Proto mining business and open source development funding, has divided investors. Supporters regard it as a coherent long-term position on the future of payments; critics argue that it exposes shareholders to an unrelated and volatile asset and diverts management attention from the core payments business, a concern reinforced by the company's uneven share price performance.
Tidal
The Tidal acquisition has been persistently questioned by analysts as outside the company's competence, and Block wrote down a substantial part of its value and reduced the business's headcount in 2023 and 2024.
Dual roles of Jack Dorsey
Dorsey's simultaneous leadership of Twitter and Square until late 2021 attracted criticism from investors in both companies, including an activist campaign at Twitter seeking his removal on the ground that neither company was receiving adequate attention from its chief executive.
See also
References