How Block’s New Protocol Enables Instant Bitcoin-to-Mobile Money

Jack Dorsey is betting that cross-border payments can be made cheaper and easier to integrate without recreating the “centrally” dominated crypto and fiat rails. On December 1, 2023, Block Inc.’s tbDEX protocol went live in Africa through Yellow Card as its first major Participating Financial Institution (PFI), and later with Chipper Cash joining the network.

This is not a generic crypto payment gateway but rather a real-world application of what Jack has termed as “true” decentralization, eventually leading to one of his most ambitious goals, a Web5 platform.

TL;DR,

• Block’s tbDEX protocol enables compliant Bitcoin-to-fiat payments across 40 African countries through Yellow Card and Chipper Cash, using self-sovereign identity instead of trustless design.
• Jack Dorsey’s tbDEX is a liquidity discovery layer—not a DEX—that settles crypto-to-fiat via regulated partners, trading decentralization for compliance and reach.
• Launched in Africa with Yellow Card ($3B+ volume) and Chipper Cash (5M users), tbDEX relies on KYC-compliant PFIs, raising questions about true decentralization.

What Is tbDEX? Technical Architecture and Design

While many might assume tbDEX is a standard decentralized exchange, guess again.

The protocol is an open-source messaging and credential layer used to discover liquidity providers, negotiate a quote, and exchange compliance information. The system then settles the payment outside the protocol using existing fiat rails and crypto networks (Bitcoin, stablecoins, etc.).

According to the TBD whitepaper (19 Nov 2021) and its technical preview notes (10 Dec 2023), there’s no protocol-native automated market maker (AMM), and no governance or utility token.

The protocol relies on two key web standards to enable its self-sovereign identity approach:

• Decentralized Identifiers (DIDs): Allow participants to establish verifiable, self-controlled digital identities
• Verifiable Credentials (VCs): Enable users to prove KYC/AML compliance or sanctions screening without surrendering full personal data to centralized databases

Self-Sovereign Identity can reduce repeated, siloed onboarding friction while still satisfying AML/CFT checks (for example, sanctions credentials).

TBD COO Emily Chiu described its makeup as bridging “new technologies with established systems without requiring people to abandon the financial tools they use today.”

Mike Brock, CEO of TBD, explained:

“At its core, tbDEX brings a layer of trust to exchanging assets. The internet is missing a standardized way to make trusted transactions between fiat currencies, Bitcoin, stablecoins, or any digital asset, without the involvement of an intermediary.”

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How tbDEX Enables Bitcoin-to-Fiat Off-Ramps

Here’s how tbDEX enables Bitcoin to fiat off-ramps when a wallet or fintech integrates TBD’s APIs and routes liquidity to a PFI like Yellow Card:

• Initiation: A user’s wallet app initiates a payment in USD, Bitcoin, or stablecoins through TBD’s APIs.
• Discovery & Negotiation: The tbDEX protocol queries available PFIs to find one offering the desired local currency, then negotiates exchange rates and compliance requirements.
• Compliance Verification: The PFI validates credentials (KYC/AML, sanctions screening) using Self-Sovereign Identity standards.
• Settlement: The PFI converts the digital asset and delivers local fiat to the recipient’s bank account or mobile money wallet—such as M-Pesa or MTN Mobile Money.

As its first PFI, Yellow Card used the network to exchange Bitcoin for Kenyan shillings and deposit them into M-PESA while meeting compliance requirements.

Yellow Card and Chipper Cash: The African Deployment

The “decentralization” pitch often distracts from the operational and underlying reality of how the continent approaches digital assets. Africa-wide payouts are challenging because liquidity, licensing, banking access, and mobile money integrations differ country by country.

Yellow Card became tbDEX’s first choice in December for good reason. The platform is a major on/off-ramp partner with a scale and licensing footprint. It literally describes itself as “the largest and first licensed stablecoin on-/off-ramp platform in Africa,” with 30,000 business customers and 1.7M+ retail users (late 2023) and $3B+ transaction volume.

Furthermore, Yellow Card is among the key drivers of Africa’s stablecoin adoption, supporting USDT, USDC, and PYUSD. Its live coverage spans:

• Botswana, Cameroon, DR Congo, Côte d’Ivoire, Gabon, Ghana, Kenya, Malawi, Nigeria, Republic of Congo, Rwanda, Senegal, South Africa, Tanzania, Uganda, Zambia, Togo, Mali, Benin, and Burkina Faso. (Yellow Card country list in project reporting)

In October 2024, Yellow Card raised a $33M Series C led by Blockchain Capital (total funding $88M).

Chipper Cash later joined on May 14, 2024, onboarding and serving over 5 million consumers across 21+ nations and extending tbDEX coverage to 40 African countries.

Maijid Moujaled, Chipper Cash President, stated:

“Remittances are a lifeline for many African families, but the costs of sending money to the continent remain among the highest globally.”

The core trade-off: true decentralization vs. compliance reality

Block’s TBD has marketed this direction as aligned with true decentralization—especially in contrast to VC-driven Web3 dynamics Dorsey criticized publicly (“You don’t own Web3…” Dec 2021). (Dorsey tweet, Dec 2021)

Block’s TBD and Jack Dorsey have focused on developing what they term as true decentralization. In Jack’s view, current VC-driven Web3 dynamics are heavily centralized despite preaching decentralization.

The tbDEX protocol is explicit about something many miss: it’s not “trustless.” The program relies on regulated PFIs, real-world identity checks, and credential exchange. However, many argue that KYC is required, and regulated entities sit at the liquidity endpoints, so it is “far less decentralized than a DEX in the truest sense,” trading censorship-resistance and anonymity for compliance and reach.

Here are the facts: a network like this tends to succeed or fail less on ideology and more on whether PFIs can consistently quote tight spreads, clear compliance quickly, and deliver payouts reliably across fragile rails (bank downtime, mobile money fraud, SIM swaps, and chargeback risk).

Risks and open questions investors and regulators should not ignore

• Decentralization is constrained by PFI concentration.  With only a small number of PFIs (notably Yellow Card and Chipper Cash), liquidity depth and pricing may be less competitive than dominant incumbents like Binance P2P in some corridors.
• Security maturity is unclear.  As of Dec 2025, there is no widely publicized independent third-party security audit of the protocol itself.
• Regulatory scrutiny is real.  Block was fined $40M by New York DFS in April 2025 over AML/KYC failures tied to Cash App’s Bitcoin transactions. Evidence that regulators will pressure the weakest compliance link in the stack.
• Network metrics aren’t public.  No network-wide volume, user counts, or DAU numbers have been published. Beyond the March 2023 PoC and pilot examples, adoption is difficult to verify externally.
• Fees are not standardized.  There’s no protocol-level fee, but PFIs charge market fees; there is no published universal fee schedule.

What this rollout actually proves (so far)

The tbDEX protocol is best understood as a compliant liquidity discovery and negotiation layer.

It’s deployed first in Africa to connect crypto value transfer with local fiat delivery through PFIs like Yellow Card (and later Chipper Cash). It may advance Block’s true decentralization narrative and its broader Web5 platform vision.

With Yellow Card and Chipper Cash operational, the protocol’s next test is proving it can scale liquidity, attract additional PFIs, and deliver measurable cost savings.