Block (NYSE: SQ) might be making a name for itself in the financial services industry. However, its shares haven't made for a winning investment.

In the past five years, this fintech stock has climbed just 32% (as of Nov. 26). During the same time, the S&P 500 has generated a total return of 107%, more than doubling one's starting capital.

Are You Missing The Morning Scoop? Wake up with Breakfast news in your inbox every market day. Sign Up For Free »

But where will Block be in five years? Could it finally start to better reward its shareholders?

Closing the loop

Block's management team has been working to find ways to further strengthen the connection between Square and Cash App, likely as part of an effort to create a more powerful and independent payments system. This is advantageous because it won't rely as heavily on dominant networks like Visa and Mastercard.

The ideal transaction for Block is probably when a Cash App consumer purchases something from a Square merchant. The method of payment could be Cash App Pay, which pulls funds directly from the user's account. It could also be the Cash App Card or the buy now, pay later feature known as Afterpay.

In all of these scenarios, Block essentially gets to pocket all or nearly all of the transaction fees. As a younger fintech enterprise looking to disrupt the payments landscape, figuring out ways to bypass the major card networks that are Visa and Mastercard, and not pay them any fees, is the goal.

As of Sept. 30, there were 57 million monthly Cash App users and 24 million Cash App Card holders. Moreover, Square processed $59.9 billion in gross payment volume during Q3. Given the combined active card base of 7.7 billion and total payment volume (in the three-month period that ended Sept. 30) of $6.5 trillion, Block is still a very tiny fish in a massive pond.

Betting on Bitcoin

Jack Dorsey, Block's co-founder and CEO, hasn't been shy about vocally showcasing his support for Bitcoin, the world's oldest and most valuable cryptocurrency. "I don't think there is anything more important in my lifetime to work on," he said in 2021.

This bullishness has resulted in a new strategic focus for Block. The company is working on various Bitcoin-related initiatives, like a hardware wallet, mining equipment, and unique payment use cases to further bolster the adoption of the digital asset. As of Sept. 30, Block owned $530 million worth of Bitcoin on its own balance sheet, with the first purchase happening in 2020.

Critics could argue that this is a big waste of time and money, taking away from the core of what Block does.