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Block shutters European P2P business Verse

Lucinda Shen
Illustration of a marionette, with the strings cut, attached to money instead of a puppet

llustration:Rebecca Zisser/Axios

Fintech giant Block shut down Verse, the European P2P payments business it acquired in 2020, CEO Jack Dorsey said in the company's earnings call last week.

Why it matters: The acquisition was viewed as a way for the company's consumer-facing Cash App, which operates in the U.S. and U.K., to expand into the lucrative European Union.

What they're saying: "These required significant investment and the markets have not seen the growth and profitability we had expected over the past several years," Dorsey said. "As we continue to drive toward our goal, we may identify other areas where we aren't seeing the expected and necessary returns."

  • The company also wound down its Clearpay BNPL operations in Spain, France and Italy. Clearpay is Afterpay's European business.

Of note: Spain-based Verse has found itself in regulatory crosshairs in recent years. In late 2021, the Bank of Lithuania said the company was at risk of breaking laws covering money laundering and terrorist financing if it did not update its procedures, per Forbes.

  • Verse implemented changes as a result of those concerns, with the Bank of Lithuania reviewing the moves as of late last year.

The bottom line: Companies are shrinking their financial super app ambitions as investors emphasize profits and moderate spending.

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