Jack Dorsey’s digital payments company, Block Inc., has reached a $40 million settlement with the New York Department of Financial Services (NYDFS). This agreement addresses allegations of compliance misconduct associated with its widely used Cash App platform, as initially reported by Bloomberg. The settlement concludes an NYDFS investigation into Cash App’s Anti-Money Laundering (AML) and cryptocurrency compliance operations, marking another significant regulatory challenge for the company, which was founded by the former Twitter CEO and Bitcoin proponent in 2009.

According to a consent order reviewed by Bloomberg, the NYDFS determined that Block had violated consumer protection laws. The agency specifically cited failures to conduct adequate due diligence, slow reporting of suspicious transactions to regulators, and insufficient screening of “high-risk” Bitcoin transactions. Cash App, which has offered users the ability to purchase Bitcoin since at least 2018, has become a prominent entity in the digital payments and cryptocurrency sector, boasting more than 57 million monthly transacting users as of early 2024.

Block confirmed its cooperation with the NYDFS to “resolve the matter principally related to Cash App’s past compliance program” but did not admit to any wrongdoing as part of the settlement. Discussions between Block and the NYDFS had been ongoing since the previous year, as revealed in filings submitted to the U.S. Securities and Exchange Commission (SEC). The settlement mandates that Block enhance its compliance measures; however, the specific details of these corrective actions have not been publicly disclosed.

This is not the only regulatory penalty Block has encountered in 2025. Earlier in the year, the company paid $80 million in fines to several state regulators over separate allegations concerning AML program violations. Despite these regulatory setbacks, Block’s core business operations demonstrate continued strength. For its fourth-quarter earnings in 2024, the company reported a 4.5% year-over-year revenue increase, reaching $6.03 billion, with per-share earnings surging 51% to $0.71. Cash App alone contributed $1.38 billion in gross profit during that quarter, highlighting its crucial role as a primary growth driver.

Block’s merchant gross payment volume, which measures the total money processed through its systems, rose by 10% to $61.95 billion, indicating strong adoption of its services. Cash App’s integration of the crypto accounting software TaxBit in 2023 has further boosted its appeal by simplifying tax reporting for cryptocurrency transactions, aligning with the platform’s ongoing support for Bitcoin and other digital assets. However, Block’s stock has not been immune to broader market pressures. Despite its robust operational performance, the company’s share price has dropped over 37% in 2025 amidst a wider market sell-off. This decline contrasts with the company’s otherwise positive financial trajectory and underscores the complexities of navigating regulatory scrutiny within a volatile economic environment.

The NYDFS settlement highlights the intensifying regulatory focus on cryptocurrency-related businesses, particularly concerning AML and consumer protection compliance. NYDFS Superintendent Adrienne Harris has previously emphasized the importance of transparency, cautioning crypto firms to “never surprise your regulator.” Block’s situation exemplifies the broader trend of regulators holding fintech companies to higher standards as digital payments and cryptocurrencies gain mainstream acceptance. For Block, this settlement concludes a period of regulatory uncertainty while reinforcing the necessity for robust compliance frameworks. The company’s ability to sustain growth in its Cash App unit and broader payment ecosystem suggests resilience, but persistent market challenges and evolving regulatory expectations will undoubtedly shape its future trajectory. As Block continues to innovate in the fintech and crypto spaces, its capacity to balance stringent compliance with strategic expansion will be pivotal in maintaining its leadership position in digital payments.