Block Inc is in settlement talks with NYDFS over compliance violations relating to its Bitcoin program.
By Godfrey Benjamin
Edited by Julia Sakovich
Updated
3 mins read
American Financial Services and technology company Block Inc (NYSE: XYZ) is working to settle a case with the top New York regulatory agency. According to reports, the technology company is in talks with the New York State Department of Financial Services (NYDFS) to settle its Bitcoin and anti-money laundering compliance violations.
It is worth mentioning that this issue has been ongoing for years. Reports show that the litigation started between 2021 and 2023 when the SEC filed a petition against Block over compliance problems.
Earlier this year, the US market leader in point-of-sale systems paid $80 million to settle cases with several state regulators. The company also revealed that it hired an independent consultant to help overhaul its anti-money laundering policies at the time.
However, NYDFS was not included in the $80 million settlement deal because the firm and the agency discussed different settlement terms in January. In its latest SEC filing, Block said it is “continuing negotiations” to reach a deal. The company confirmed it has set aside funds for this but said the amount is “not material” to its finances.
Still, Block has not admitted to breaking any laws, and the entity did not disclose details about the settlement terms. However, it is important to note that the issue is not over. The filing warned that ongoing regulatory scrutiny could still affect its business.
At the time of writing, Block’s stock was up 2.10% in the pre-market, trading for $64.16.
Furthermore, Block is also facing tax litigation in San Francisco. The state security agency claims the firm has yet to pay additional taxes on its Bitcoin profits from 2020 to 2022.
However, the fintech giant strongly disagrees. In response, it revealed that it has already paid $71.4 million to fight the claim and is pushing for a refund.
Meanwhile, investigations into the company continue. The SEC and the Department of Justice are still looking into Block’s business practices. In its filing, the company admitted it is “unable to predict the outcome” of these inquiries.
At the same time, the company is making big changes. As Coinspeaker reported earlier, it plans to focus on Bitcoin mining and scale down efforts on its other projects. Block is scaling down its music streaming service, TIDAL, and shutting down its decentralized web project, TBD.
A shareholder letter confirmed the shift. “We are prioritizing Bitcoin innovation,” the Jack Dorsey-led firm wrote. The move is part of a larger effort to strengthen its position in the industry.
Earlier this month, MARA Holdings, a publicly traded cryptocurrency company, revealed its focus on Bitcoin mining. They announced the completion of its acquisition of a wind farm in Hansford County, Texas.
Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.
Benjamin Godfrey is a blockchain enthusiast and journalist who relishes writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desire to educate people about cryptocurrencies inspires his contributions to renowned blockchain media and sites.
