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Gem Blocks are decorative blocks that do not appear in naturally generated maps. They are obtained by crafting nine of the same Gem in a 3x3 square in a crafting grid. They are currently only used as decorative blocks and as a compact way of storing Gems. A Gem Block can only be mined successfully with an Iron Pickaxe or better. They use the same texture on all six faces. Gem Blocks can be made into Micro Blocks, but only by using a Diamond Handsaw.
You can also craft them back into the original 9 gems by putting them back in a crafting grid.