Block DOJ settlement: Cash App parent agrees to $764M AML deal as bitcoin profit halves

4 Nov 2026

4 Nov 2026, 08:05 UTC+01:00

Regulation TradeReviewed News Desk

Block’s DOJ settlement is one of the largest anti-money-laundering cases ever tied to a mainstream bitcoin app. Jack Dorsey’s payments company, the parent of Cash App, has agreed in principle to a resolution with the US Justice Department that carries a gross monetary component of about $964 million, cut to roughly $764 million after credits for earlier regulatory settlements, according to a November 3 SEC filing reported by CoinDesk and The Defiant.

What Block agreed to

According to CoinDesk, the agreement was reached in October and would defer for three years a criminal charge alleging that Block failed to maintain an effective anti-money-laundering program, as required under the Bank Secrecy Act. Block says it has already set aside the $764 million. That figure is larger than the $566 million profit the company reported for the third quarter, which shows how heavy the bill is even for a firm of Block’s size.

The deal is described as an agreement in principle. That means the final terms still have to be completed, and nothing in the filing as reported says the charge has been filed or dismissed yet. Under a deferred prosecution structure, a charge is typically dropped at the end of the period if the company meets the conditions, but the specific conditions for Block have not been reported.

How the investigation started

The probe dates back to 2023. The Justice Department and the Securities and Exchange Commission began examining Block’s compliance practices and related disclosures after a report from short seller Hindenburg Research. That report alleged that Cash App inflated user numbers by counting duplicate and fraudulent accounts, and that weak identity checks let criminals use the platform for scams, money laundering and other illicit payments. Block rejected the findings as inaccurate and misleading.

The SEC closed its own investigation in March without recommending enforcement action, CoinDesk reports. The DOJ track continued and has now produced this proposed resolution.

This is not the first penalty. In April 2025, New York’s financial regulator fined Block $40 million after finding serious gaps in its compliance systems. That review found a backlog of suspicious transaction alerts that grew from about 18,000 in 2018 to more than 169,000 by 2020. It also found that one of Block’s screening systems did not automatically block bitcoin transfers to wallets linked to terrorism financing until their exposure exceeded 10%.

Bitcoin profit at Cash App halves

The same filing period brought weaker bitcoin numbers. Block’s bitcoin ecosystem gross profit fell 50% to $52 million in the third quarter, from $104 million a year earlier, while bitcoin revenue declined 11% to $1.8 billion. Block attributed the drop mainly to its decision to reduce fees on certain bitcoin transactions.

The wider business kept growing. Overall gross profit rose 22% to $3.24 billion, helped by stronger lending and payments activity across Cash App. In other words, bitcoin is becoming a smaller slice of Block’s profit, even as the company remains one of the best-known bitcoin backers in public markets.

TradeReviewed analysis: why this matters for crypto users

Three points stand out.

• Compliance is the price of scale. Cash App is one of the main ways retail users in the US buy bitcoin. A near $1 billion AML case shows that regulators judge crypto on-ramps on the same Bank Secrecy Act standards as banks, whatever the political mood. For users, that usually means stricter identity checks and more frequent account reviews, not fewer.
• The fee war is real. Block chose to cut bitcoin fees and accepted a 50% drop in bitcoin gross profit. That is good for buyers in the short term, but it also signals that margins on simple buy and sell flows are shrinking across the industry. Platforms will look for revenue elsewhere, such as spreads, lending or subscriptions, so the headline fee is only part of the real cost.
• Timing with US politics. The filing landed during a week when Democrats won control of the Senate, as we covered in our report on bitcoin dipping to $75,700 on the midterm results. Enforcement cases that began years ago keep running regardless of election outcomes, and this one shows AML remains a bipartisan priority.

What to watch next

• Whether the final DOJ agreement is signed on the terms disclosed, and whether it imposes a monitor or specific compliance requirements on Cash App.
• How Block’s bitcoin strategy evolves now that its bitcoin profit has halved.
• Whether other app-based crypto brokers face similar scrutiny of their suspicious-activity alert backlogs.

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Sources

• CoinDesk: Jack Dorsey's Block faces $764 million DOJ settlement as bitcoin profit plunges 50%
• The Defiant: Block Reaches $964 Million DOJ Deal in Principle Over AML Lapses

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