What Makes Block Trading 70% Below Peak Such a Unique Play?

The Real Growth Story Behind Square and Cash App

Block’s transformation over 15 years tells an interesting story. What started as a simple card reader attached to smartphones has morphed into a major payments and fintech player. The company operates through two core engines: Square (targeting small merchants) and Cash App (serving everyday banking users). Both just posted strong double-digit gross profit growth in Q2 2025.

The numbers speak volumes. Square serves over 4 million merchants while Cash App has 57 million monthly active users. That’s not just scale—it’s ecosystem leverage. When customers add a new service to their existing Square or Cash App account, the money flowing through these platforms multiplies, driving revenue growth across the board.

Where’s the Upside?

Management’s own data reveals massive headroom. Square’s total addressable market is pegged at $130 billion (from a gross profit lens), while Cash App can tap into a $75 billion opportunity. Meanwhile, Block generated just $9.4 billion in gross profit over the past 12 months. That’s roughly 7-10% penetration across both segments—plenty of runway ahead.

The competitive advantage lies in targeting underserved customers that traditional banks largely ignored. However, this niche positioning comes with a hidden cost: these customers are more economically vulnerable. An economic slowdown hits harder when your user base lives paycheck to paycheck.

The Bitcoin Bet No One’s Talking About

Here’s where Block gets polarizing. The company isn’t just accepting payments or offering storage—it’s deeply committed to Bitcoin infrastructure. Jack Dorsey, the co-founder and CEO, has been explicit about seeing Bitcoin as the most important mission.

The breadth of involvement is striking. Cash App users can buy and hold Bitcoin. Square merchants can now accept Bitcoin payments directly. Bitkey is Block’s entry into self-custody wallets. Proto represents the company’s push into mining equipment. And on the balance sheet? Block holds 8,692 Bitcoin directly—a serious corporate bet.

Bitcoin contributed only $81 million to gross profit last quarter, but that’s today. Five to ten years out, expect Bitcoin integration to deepen significantly across all Block products. Investors seriously considering Block stock should also be seriously bullish on where Bitcoin heads.

Valuation Makes Sense at These Levels

Trading at a forward P/E of just 20 after falling 70% from all-time highs, Block’s valuation has compressed meaningfully. For a fintech company pivoting toward profitable growth, that’s not expensive anymore.

The question isn’t whether Block is cheap—it’s whether you believe in the combination of payments dominance and cryptocurrency infrastructure. Both are powerful. Neither alone guarantees outperformance. The stock deserves consideration from investors seeking exposure to fintech and Bitcoin, but it’s not necessarily the singular best opportunity markets are offering right now. More entrenched, profitable competitors exist in traditional finance. Block is the higher-risk, higher-conviction play.

The Bottom Line

Block represents a specific thesis: that payments fragmentation benefits nimble operators, and that Bitcoin eventually becomes native to financial infrastructure. If you believe both, the current valuation is interesting. If you’re uncertain on either front, there are safer bets elsewhere.