Exodus Movement, Inc.

Welcome, everyone, to Exodus's fourth quarter of 2024 earnings conference call. I'm your host, Greg McNiff, and joining us today are Exodus co-founder and CEO, J.P. Richardson, and Exodus CFO, James Granatsky. During today's call, we may make forward-looking statements. The company cautions investors that any forward-looking statements involve risks and uncertainties and are not a guarantee of future performance. Actual results may vary materially from those expressed or implied in the forward-looking statements due to a variety of factors. These factors are described under forward-looking statements in our earnings press release and our most recent registration statement on Form 10, filed with the Securities and Exchange Commission, available on the investor relations portion of our website. We do not undertake any obligation to update forward-looking statements. Please visit our social media accounts, X for Reddit, to submit your questions for the quarter for our investor relations team after our call. And with that, let's go to JP for the review of Exodus' preliminary fourth quarter and full year 2024 results.

Hey, everyone. Thank you for joining us today. Our unaudited Q4 results represent yet another strong quarter for Exodus. As we continue executing on our strategy to bridge traditional finance and blockchain technology, we delivered record revenue while introducing innovations designed to make digital asset ownership frictionless and accessible to everyone. In Q4, we grew revenue 143% year over year to $44.8 million. We continue to scale our business by expanding on the partnerships we announced last quarter. We currently have 11 partners signed with Exoswap, with five of those already in the integration process. Exodus finished the full year with $116.3 million of revenue, and those are record revenues on the quarter and the year. Accordingly, we accomplished several milestones in the quarter, building on last quarter's momentum and aligning with our growth initiatives. Let's run through those milestones. First, we continue to invest in marketing and education. As many of you are aware, Exodus was a co-host of the first crypto ball in B.C. Expect to see similar marketing initiatives in the coming months as we shoulder increasing responsibility to foster awareness and adoption of Bitcoin, DeFi, and Web3, especially to the policymakers in D.C. Meanwhile, self-custody remains the core of our business. As Exodus continues to empower users with a secure multi-chain wallet for Bitcoin, Ethereum, Solana, and beyond. Our exchange aggregator technology extends our natural multi-chain capabilities by connecting consumers with the most competitive rates and transaction speeds. While our newest launch, ExoPay, also simplifies fiat onboarding to improve the whole user experience. Now, the most exciting development this quarter was the very strong performance of our newly announced B2B2C swap aggregator, ExoSwap. This ExoSwap product leverages the exchange aggregator technology with its decade of refinement and reliability and serves to other industry players, including Ledger and Magic Eden. As a reminder, our exchange aggregator enables consumers to retain control over their crypto transactions while providing transparency and security. This aggregation is intended to enable consumers of other wallets to receive the best available rates and fulfillment times. Exoswap is truly a best-in-breed solution for any wallet or Web3 dApp, looking for multi-chain swap capabilities honed, as I mentioned, in our own wallet over the past decade. And with Exoswap contributing 12% of our Q4 revenue, we are enthusiastic about its long-term potential. We are closely tracking its momentum in 2025. Furthermore, the PassKey wallet launch marks a major step in simplifying crypto access with frictionless onboarding. Passkey's wallet is a self-custodial multi-chain wallet that can be embedded directly into dApps and web platforms. Some call this technology smart wallets. We prefer the phrase instant wallets. With Passkey's wallet, consumers can create and access a crypto wallet without any friction. No need for downloads, no accounts, no email verification, no storing of a 12-word secret recovery phrase. Instead, the self-custodial wallet is seamlessly managed using Face ID, Touch ID, a PIN, or even password. This solution improves the user experience and offers developers a powerful tool to integrate crypto functionality into their platforms. Early adoption has been strong, and we are excited about its growth potential in the quarters ahead. PathFeed ended 2024 with over 200,000 users thanks to a marketing program we ran on X. Shifting gears, acquisitions remain on the table as Exodus continues to build its pipeline of targets. There is significant inbound interest from companies looking to join us on our journey, but we will not be sharing any names at this time. There's a longer-term vision we will share in the future earnings release that we believe partnerships and acquisitions will help to accelerate. And in December, we celebrated with an uplifting to the NYSE American Exchange, where we are enjoying the increased liquidity, better opportunities to access capital, and improved visibility with investors. Beyond Exodus, our broader crypto ecosystem gained momentum throughout Q4. increasing mainstream adoption and institutional participation. The Trump election preceded major changes in the acceptance of our industry. Bitcoin ETF inflows were substantial, with $16 billion on the quarter, while Bitcoin reached $100,000 for the first time. And to put the cherry on the sundae for Exodus, yesterday, President Trump announced a crypto strategic reserve by which the presidential working group on digital assets would move towards creating U.S. investments in Bitcoin and other digital assets. As we say in crypto, LFG. And so Q4 was very strong as Exodus grew while innovating to make digital assets more accessible. Our NYSE American Uplisting, our major product rollouts like Exoswap and Passkey's Wallet, and our focus on superior customer experience. We believe all of these factors have Exodus solidly on track for a prosperous 2025. I just want to thank you all to our customers, partners, investors, and team members for joining us at every milestone. We are at the very early stage of this journey to make Exodus the leading Web3 technology platform, and I couldn't be more excited about our opportunities ahead. We look forward to reaching many more milestones as we seek to transform our visions into reality. And now I'll hand it to James for a financial update.

Thanks, JP. Q4 was a strong milestone quarter for Exodus and the market. But before jumping into Q4 and 2024 results, I'd just like to remind everybody, we recognize the large majority of our revenue from fees we charge third-party API providers for access to our users. And in particular, revenue generated from our exchange aggregation API providers makes up the core of our business. We do have non-exchange aggregation revenue as well, which comes from API providers with other capabilities such as staking and fiat onboarding. Given our model, business performance has historically been affected by the cryptocurrency market cycles, which can be volatile in the short term. However, when looking over a longer period of time, we have been able to scale our business across these cycles. So in the future, we expect to further capture our addressable market through strategies such as partnerships and products such as Exoslava. In Q4, we generated $44.8 million in revenue, representing 143% growth year-over-year and 123% sequentially. This year-over-year revenue growth was driven by strength in both our exchange aggregation and non-exchange aggregation revenues, and further supported by increased user activity and continued positive momentum in the cryptocurrency market. Exchange aggregation accounted for 92% of total revenue in the full year 2024. And of that exchange revenue, 93% was from our users and 7% was from our ExoSwap partnerships, while non-exchange aggregation, including fiat onboarding and staking revenue, represented 8% of the total revenue. One of the key developments in the second half of 2024 was ExoSwap, as the partnerships came fully online with meaningful contributions towards the end of the year. And this momentum has continued into the first quarter of 2025. Exchange provider process volumes for the quarter were $2.3 billion, reflecting 169% growth year-over-year and 139% sequentially, which was made possible as cryptocurrency valuations increased on the year, along with Exodus's user base. Monthly active users in Q4 reached 2.3 million, which compares to 1.4 million a year ago and 1.6 million in Q3. This growth was driven by multiple factors. We enjoyed increased user engagement, new product launches, and ongoing marketing initiatives throughout the year. On our balance sheet, we ended the quarter with $265 million in digital and liquid assets, primarily composed of Bitcoin, Ethereum, US dollars, and treasury bills, while we remained debt-free. We continue to be early adopters of ASU 202308, which as a reminder means our digital assets are now recorded at fair value. You can clearly see our long term Bitcoin strategy in action on this chart, which highlights our accumulation over time. We held 1941 Bitcoin as of the end of Q4 compared to 1800 units in Q3. Looking back, we held 1787 Bitcoin as of 2023 year end. Our Bitcoin holdings have grown over time as we have strategically managed our treasury to align with our long term vision. Looking ahead, we intend to take a disciplined approach to treasury management, balancing operational needs with opportunities to strengthen our digital asset position. And to bring everybody up to speed on the new year, I'll provide preliminary Q1 highlights that demonstrate that this quarter is off to a strong start. Through the first two months of Q1 2025, we have seen volumes of $1.45 billion, which for comparison is already higher than the volume we saw in each of the whole first three quarters of 2024. Of that, 23% of the volume is related to ExfaSwap partnerships. We've also grown our digital asset holdings, ending February with over 2,000 Bitcoin units in our corporate treasury. So to wrap up our discussion, Q4 was another strong quarter for Exodus as we continue to capitalize on the growing digital asset market. We remain committed to maximizing shareholder value, and we thank you all for your support. With that, we'll take some questions.