HTC has experienced years of declining sales as competitors, particularly those from China, surpassed the company with top-of-the-line smartphones. In June, HTC reported it lost nearly 68 percent in revenue compared to the year-ago period. That was despite the launch of a new smartphone in May called the U12+, which received largely negative reviews. At the same time, HTC is reportedly planning to slash about 25 percent of its global workforce to better manage its resources.
More broadly, the smartphone industry is no longer growing as rapidly as it used to because there are fewer people left to convert. In fact, the International Data Corporation said it expects 0 percent growth for the global smartphone market this year. Even then, existing smartphone makers have carved up sizable chunks of the market with their annual line-up of flagship phones. In the first quarter of this year, HTC had only 0.2 percent of market share, according to IDC.
The Exodus "isn't going to be the thing that turns the company around," Bryan Ma, vice president for devices research at IDC, told CNBC. "The worry is that HTC is jumping on the bandwagon, or just trying to ride a hype cycle around blockchain, which, incidentally if you look at cryptocurrency, has kind of collapsed in the past couple of months. It really is rather baffling as to the direction they're taking with this."
Still, blockchain is a relatively new technology that can potentially help HTC build a more secure smartphone as more applications are created. At the moment, the Exodus website does not provide much information about what would be available inside the phone, but the device is said to be the "first cold wallet phone with key recovery."
A cold wallet is essentially a digital wallet that is not connected to the internet, so there are fewer chances of its contents being stolen. Private keys — unique alphanumeric characters known only to the user — allow for the withdrawal of cryptocurrencies stored in those wallets.
"When we ship this, it will be the most secure cold storage wallet on the market," HTC's Chen told CNBC in an interview. When asked what exactly made the Exodus a blockchain phone, he explained it would make it easy for people to interact with the technology.
Technology publication The Verge reported that the Exodus would basically be a "phone with a wallet and a partnership with Cryptokitties," referring to a popular blockchain-based virtual game. Chen said the initial Exodus phones would not be able to "mine" — solving complex equations for cryptocurrency rewards — because of the huge power consumption required for that task. Still, he said, HTC is investigating ways to make that possible.
Chen also noted that project Exodus would be a completely separate product from the smartphone-maker and that it would have a different target audience.
"We do see this as a completely new sort of path of what a smartphone is," he said. "And I think this notion of a smartphone will completely change because of blockchain technologies."