On February 27, fintech company Block announced it has reduced its staff to approximately 6,000 employees, close to its 2019 level (around 3,800 employees), a significant contraction from the peak of over 10,000 during the pandemic. CEO Jack Dorsey stated that AI tools have improved the efficiency of small teams, but the deeper reason for this adjustment is that profit margins in the payments industry are being re-priced.
Block has long relied on earning 2% to 3% in card processing fees from merchants, which supports the business ecosystem between acquirers and credit card networks. However, stablecoin payments offer near-instant settlement and cost structures at a few cents, creating direct competitive pressure on traditional bank card channels. Citrini Research’s report “When Friction Drops to Zero” notes that as AI shopping assistants can automatically compare prices and choose the optimal payment route, transaction decisions will increasingly be based on cost and speed rather than brand preference.
In a machine-dominated payment environment, high-fee models are unsustainable. If merchants can significantly reduce costs through stablecoin channels, the profit distribution mechanism of the card network will inevitably be squeezed. The nearly 40% layoffs are also seen by the market as an early move to anticipate downward pressure on fees, rather than just a correction for overly rapid expansion during the pandemic.
Capital markets responded positively, with Block’s stock price rising over 23% after hours, though it remains about 80% below its pandemic high. As stablecoins gradually gain regulatory approval and AI-driven payment decision-making accelerates, the revenue structures and cost models of payment companies are facing a substantial stress test.
Disclaimer: The information on this page may come from third parties and does not represent the views or opinions of Gate. The content displayed on this page is for reference only and does not constitute any financial, investment, or legal advice. Gate does not guarantee the accuracy or completeness of the information and shall not be liable for any losses arising from the use of this information. Virtual asset investments carry high risks and are subject to significant price volatility. You may lose all of your invested principal. Please fully understand the relevant risks and make prudent decisions based on your own financial situation and risk tolerance. For details, please refer to
Disclaimer.
Related Articles
Ripple Introduces an XRPL Privacy Transfer Solution: Multi-Purpose Tokens Enable Institutional-Grade Compliance and Security
The Ripple research team has proposed a multi-purpose token transfer solution that provides privacy protection on the XRP ledger, aiming to support regulatory and institutional application scenarios. By ensuring transaction privacy and compliance through confidential transfers, this solution combines cryptography and zero-knowledge proof technology to meet auditing requirements and ensure higher privacy protection, which may drive institutional users to adopt XRPL for high-value digital asset operations.
GateNews6m ago
Lido DAO proposes to buy back LDO: 10,000 stETH to support token price in phases.
Lido DAO has proposed a governance plan to conduct phased repurchases of LDO tokens in response to market downturns, with a maximum allocation of 10,000 stETH, approximately worth 20 million USD. The proposal indicates that the LDO price has significantly diverged from the protocol's fundamentals; the repurchase aims to provide short-term price support, demonstrate management capability, and reassure investors. Stakeholders are advised to monitor the progress of the repurchase and market reactions.
GateNews14m ago
Ethereum Economic Zone Targets L2 Fragmentation, Assets Up 40%
Ethereum’s tokenized asset ecosystem has seen rapid growth, but the network’s expansion has highlighted inefficiencies across its layer-2 infrastructure. A new initiative, the Ethereum Economic Zone (EEZ), has been launched to address fragmentation and streamline interoperability across these networ
DailyCoin18m ago
USDD TVL surpassed $1.93 billion, setting a new historical high, with an increase of approximately $500 million within a week.
The total value locked (TVL) of the decentralized stablecoin USDD across the entire network has surpassed $1.93 billion, increasing by $500 million recently and setting a new all-time high. USDD ranks 9th in the stablecoin market, attracting capital inflows thanks to its overcollateralization and 1:1 redemption mechanism.
GateNews21m ago
What signal does the Ethereum Foundation's pledge of $46.2 million in Ethereum release? The target staking total is 70,000 ETH.
The Ethereum Foundation significantly increased its staking efforts in March 2026, with a single staking amount reaching $46.2 million, setting a historical record. This shift marks a change in its fund management strategy, with staking yields being used for protocol development and ecosystem building, while also reducing market selling pressure risks.
GateNews29m ago
Pipe Network Launches SolanaCDN: A Free, Open-Source Validator Client With Built-In Acceleration for Solana
San Francisco, CA, February 26th, 2026, Chainwire
SolanaCDN delivers 3.8x faster shred propagation through a global mesh of 35,000+ nodes, provided as a public good for the Solana network
Pipe Network today announced the launch of SolanaCDN, a free, open-source Solana validator client with an
CoinDesk1h ago
