The massive hack of cryptocurrency exchange Bybit last month has weighed on Bitcoin and other digital assets. But for crypto wallet firm Exodus Movement (EXOD), it could be an opportunity, analysts say.
The Nebraska-based company’s core product, the Exodus Wallet, is a self-custody wallet that allows users to store, manage, and exchange over 1,000 digital assets.
Unlike custodial wallets — such as Coinbase Wallet, which is tied to a centralized exchange — self-custody wallets give users full control over their private keys.
That means there’s no third party holding their assets on their behalf, reducing the risks of bankruptcy (as seen with FTX) or major hacks (as seen with Bybit).
It’s that latter scenario that has Benchmark analyst Mark Palmer calling the Exodus Wallet “the right product at the right time.”
Benchmark initiated coverage of EXOD last week with a “buy” rating and a $38 price target. “Self-custody crypto wallets give users full control over their private keys,” Palmer wrote in a research note.
“The case for crypto self-custody was underlined a couple of weeks ago when centralized crypto exchange Bybit was the target of a record-breaking hack of 400k ether (worth ~$1.5bn) believed to have been executed by hackers working for the North Korean government.”
EXOD surged 34.7% on Wednesday as investors bet that growing concerns over centralized exchange security could drive more users toward self-custody solutions.
Great buying opportunity?
The Bybit hack has cast a shadow over the crypto industry, sending investors running for cover.
Even Coinbase (COIN) hasn’t been spared. Despite a major win last month when the SEC dismissed its lawsuit against the company, its stock has taken a hit. Meanwhile, Exodus (EXOD) has shed 60% of its value in recent weeks.
But beneath the sell-off, the company just delivered a standout Q4 earnings report.
Exodus reported $116.3 million in full-year revenue for 2024, up 107% from 2023, while monthly active users (MAU) surged 64% year-over-year to 2.3 million.
Benchmark analyst Mark Palmer sees the pullback as a chance to buy in at a discount.
“We believe the recent pullback in the price of EXOD’s shares has created a compelling opportunity for investors to gain exposure to a firm with strong operating momentum,” he wrote.
“The demonstrated ability to scale rapidly, and a tailwind from the more accommodative stance toward the crypto space in the U.S.”
Exodus CEO and co-founder JP Richardson confirmed on the company’s latest earnings call that Exodus had seen an influx of users following the Bybit hack, though he didn’t disclose exact numbers.
“It does continue to highlight the risk of custodial exchanges, and for us, this continues to reinforce the value proposition of Exodus and self-custody,” Richardson said.
Exodus made its public debut on NYSE America on Dec. 18.
Your email address will not be published. Required fields are markedmarked