The recent hack of crypto exchange Bybit highlights the emerging necessity for self-custody wallets. This was exemplified in a Wednesday report from broker Benchmark, which initiated coverage of Exodus Movement (EXOD) with a buy rating and a $38 price target. Following this announcement, Exodus shares experienced a 5.7% increase, reaching $25.89 in early trading.
Analyzing the current landscape, Benchmark’s analyst Mark Palmer emphasized that the Nebraska-based company possesses the “right product at the right time.” The urgent need for self-custody solutions was starkly illustrated when Bybit fell victim to a breach resulting in the theft of 400,000 ether (ETH), valued at approximately $1.5 billion.
In light of the recent events, Exodus Movement has faced a dramatic decline, losing more than 60% of its market capitalization over the past five weeks. However, this downturn presents a compelling entry point for investors looking to gain exposure to a firm that demonstrates “strong operating momentum, the ability to scale rapidly, and benefits from an accommodating regulatory stance towards the crypto space in the U.S.,” according to Benchmark.
It’s essential to note that this recent market weakness does not stem from concerns regarding Exodus Movement’s operational performance. Instead, the company has recently posted strong fourth-quarter results earlier this month, bolstering investor confidence in its prospects.
Benchmark pointed out that a significant portion of Exodus Movement’s revenue is derived from its exchange aggregation feature. Additionally, its “wallet-as-a-service” business model utilizes innovative technology through its integrated crypto swap engine, further establishing partnerships with leading platforms like Ledger and Magic Eden.
Exodus Movement began trading on the NYSE American, part of the New York Stock Exchange, in December of last year. The SEC recently approved the listing of this crypto wallet maker on NYSE American, following initial resistance earlier in the year. For more details, click here.
