The mechanism: In August 2025, a federal court vacated the Federal Reserve's Regulation II debit interchange price caps — the Durbin Amendment's 21-cent-plus-5-basis-point ceiling that has governed what banks can charge on debit swipes since 2011. The Fed is appealing, so the caps remain in force for now, but the legal ground under them just cracked. Layer on top of that the CFPB's Section 1033 open-banking rule — finalized in 2024, now under an "unlawful, should be set aside" reconsideration by new agency leadership — which governs whether banks can charge fintechs for pulling customer account data. Whichever way both fights break, they reset the plumbing economics of every dollar that moves through a small-business card swipe. That plumbing, not bitcoin, is where Block actually makes money.
Block holds roughly 9,000 bitcoin on its balance sheet and takes a cut of Cash App bitcoin trading, but that revenue is a volatile pass-through business, not the earnings engine. The engine is Square's merchant network and Cash App's payments rails, both of which live or die on interchange economics, processing routing rules, and money-transmitter licensing costs across 50 states.