Summary Exodus Movement offers secure, self-custodial wallets supporting Bitcoin, Ethereum, Solana, and Cardano, integrated with platforms like Ledger and Magic Eden. Their XO Swap platform generates about 85% of their revenue. This is mostly thanks to its security and partnerships with Ledger, without self-custody hassles. You see, EXOD's Passkeys and MPC technology significantly simplify self-custody, eliminating cumbersome seed phrases and making crypto much more user-friendly. Their balance sheet and runway also seem safe for now, though ideally, they should already be cash flow positive in my view. So, after the recent 60% price pullback, the Company now looks like a compelling play in crypto. Exodus Movement, Inc. ( EXOD ) is basically a financial technology company that offers self-custodial digital crypto wallets. These wallets allow users to swap between several blockchains and move between fiat and crypto using a user-friendly and secure platform. Interestingly, their wallets are also integrated with third-party providers that support their transactions with Bitcoin, Ethereum, Solana, Cardano, among others. Also, it has partnerships with other complementary platforms like Ledger and Magic Eden. One important feature of EXOD's wallets is the use of Passkey and multi-party computation [MPC] that are relatively user-friendly while maintaining secure self-custody standards. And after the recent 60% pullback, I feel it's fair to once again lean bullish on EXOD at these levels. A Crypto Wallet Play Exodus Movement is a fintech that was founded back in 2015 for self-custodial cryptocurrency wallets. Over time, they also added a multi-asset platform that's accessible and user-friendly. The company also aggregates third-party services for easy crypto swapping, productive stacking, and fiat-to-crypto onboarding. They're headquartered in Omaha, Nebraska, but as you might imagine, their crypto exposure makes their services available virtually worldwide. Moreover, I believe EXOD's wallets have interesting features that distinguish them from others. Firstly, many wallets are custodial, meaning that a company or exchange saves the private keys. However, this does expose the crypto assets themselves to third-party security risks. In contrast, EXOD's wallets are self-custodial , which means that they are controlled directly by the users. Corporate Presentation - March 2025 In fact, EXOD's platform doesn't have access to users' private keys because they are stored locally on their devices. Other important features are that these wallets offer simpler interfaces, good customer support, and have so far a very strong security track record. Additionally, EXOD's wallets support all the major blockchains such as Bitcoin, Ethereum, Solana, and Cardano in a single wallet. These crypto assets can be swapped within EXOD's wallet at relatively good prices and without major slippage costs. The company also offers tools to move funds between traditional money, like USD or EUR (i.e., fiat), and crypto. For this, EXOD's solutions use third-party API providers that check multiple offerings and choose the best prices available. This way, its users fulfill their buy/sell orders seamlessly at the best available prices. Also, EXOD's fiat on-ramps integrate providers such as MoonPay, PayPal, Blockchain.com, Ramp, Robinhood, and Sardine. These are all well-known payment processors with large ecosystems that make EXOD's crypto services highly accessible with traditional credit and debit cards, transfers, or even PayPal transactions. Corporate Presentation - March 2025 Furthermore, EXOD is also partnered with Ledger, which is a well-known provider of hardware wallets. For most crypto native users, hardware wallets are a must because these ensure funds are always safe and don't depend on any third parties. This allows users to store cryptocurrency offline much more securely. This is why EXOD's partnership with Ledger means their integrated XO Swap also has the same benefits as traditional hardware wallets without the hassles of self-custody. Note that XO Swap is EXOD's exchange aggregator, but it has the same security as a hardware wallet. This is because the connection from the users' ledger to XO Swap is via Bluetooth. Still, all signing operations are done inside the Ledger hardware wallet device. Since these signatures aren't performed inside EXOD's app, this basically ensures users always have end-to-end encryption in their transactions. Corporate Presentation - March 2025 At this point, the main risk comes from the human side. For instance, security breaches could involve users themselves accepting unknown pairing requests or approving malicious transactions without proper verifications on the hardware wallet's screen. Another interesting EXOD's partnership is with Magic Eden , which is a popular NFT marketplace on the Solana blockchain. Magic Eden users get access to EXOD's services to buy crypto with fiat money and then swap crypto across blockchains. EXOD's users can seamlessly interact with NFTs directly from their wallet, which is much more convenient than using the blockchain itself directly. Corporate Presentation - March 2025 More recently, in 2024, EXOD generated 85% of its revenue from XO Swap. And approximately 7% came from its partnerships with as Ledger or Magic Eden, which produce fees from swaps through those partners. Finally, around 8% of its full-year revenues came from non-exchange aggregation services like fiat onboarding and staking. So, overall, EXOD doesn't hold user funds but still produces fees through third-party services. And interestingly, roughly two-thirds of EXOD's users are international. Passkeys and MPC Simplify Self-Custody Having said that, I believe that one of EXOD's main innovations is that its platform uses Passkeys . These are a relatively new approach that simplifies access to digital wallets using biometric authentication, a PIN, or a password, without requiring a seed phrase. This way, other decentralized apps [dApps] can integrate EXOD's wallets into their systems to create or access wallets. Also, users can seamlessly use fiat onboarding tools, or even swap between crypto coins with self-custody and user control through multi-party computation [MPC]. In my view, Passkey wallet with MPC is probably going to be the future of crypto and decentralized assets in general. When users log in with biometrics or a password, EXOD's system coordinates a secure MPC protocol without needing a seed phrase. Corporate Presentation - March 2025 You see, MPC is a cryptographic method that enables multiple parties to manage a private key without accessing the full key itself. MPC allows for better security because to compromise a wallet, the attacker would need to compromise several different locations at once. And since the full private key is never in one place, there is no need to memorize a 12 or 24-word recovery phrase. Plus, if the user losses access, they can easily regain control by using cloud backups or device re-authentication instead of resorting to a long seed phrase again. The most important theme of all this is EXOD's focus on making the system safe, without sacrificing the decentralization and self-custody benefits that crypto brings. And all without expecting its users to have any technical skills. Valuation and Risk Analysis Now, from a valuation perspective, EXOD trades at a $1.3 billion market cap already, making it a mid-sized company in its sector. Its balance sheet holds $68.4 million in cash and short-term investments, against essentially no financial debt. And its book value stands at $257.5 million, indicating a somewhat high P/B of 5.1. For comparison, its sector's median P/B is just 3.1, so the stock does seem to carry a bit of a premium at these levels. After all, the stock has already retraced roughly 60% from its recent January 2025 highs. Seeking Alpha Charts Similarly, according to Seeking Alpha's dashboard on them, EXOD is projected to generate about $192.0 million in revenues by 2026. That would still price them at an expensive forward P/S of 6.8, which is also much higher than its sector's median forward P/S multiple of just 2.6 . Still, in a way, I do believe EXOD deserves a premium for its above-average topline growth of 106.9%, which vastly outpaces its peers' growth of 5.1%. Seeking Alpha And in fact, this is probably the main reason why I ultimately lean bullish on EXOD. However, looking at their latest quarterly cash burn of $5.3 million, it does imply a modest runway of 12.9 quarters. And that was back at year-end 2024, so by now their runway is probably closer to 11.9 quarters, or 3.0 years. Note that I got those figures by adding their Q4 2024 cash flows from operations and CAPEX. But ideally, I'd like to see EXOD generating positive cash flows already, given their sizeable top line, so I'm a bit concerned about their long-term margins. Similarly, if we see any margin deterioration or maybe a substantial revenue decline during this crypto downturn, EXOD's premium valuation could quickly vanish. Corporate Presentation - March 2025 And lastly, EXOD is quickly becoming a Bitcoin play in a sense, as it's actively accumulating as much Bitcoin as it can. As of 2024, they already held 1941 Bitcoins, which alone was worth as much as $194.1 million back when Bitcoin broke through the $100.0 thousand price milestone in Q4 2024. In other words, they're now directly exposed to Bitcoin's price fluctuations as well. Conclusion: Speculative Buy Overall, EXOD looks like a growth play in crypto, but that's not without its risks. Moreover, the current US administration has been vocal pro-crypto , but we don't know how this stance might change over time and with the following presidencies. Although, I would consider those more macro and long-term risks. As it stands today, I feel EXOD is a nice way to gain exposure to fees generated from crypto transactions. Plus, their focus on self-custody seems like a good strategic focus, since crypto natives tend to be very sensitive about this item as well. Thus, I rate EXOD a reasonably sound "speculative Buy" in this sector.
