Lighter price rallied sharply on Jan. 6 after the protocol confirmed the launch of its long-anticipated buyback program, pushing prices higher.
Summary
- Lighter rose 16% as the protocol confirmed its token buyback program.
- Spot and derivatives activity surged, pointing to fresh positioning.
- Price is consolidating above $3.00 after a strong breakout move.
LIT was trading at $3.06 at press time, up 16% over the past 24 hours. The move extended a volatile week that saw the token trade between $2.33 and $3.37.
Trading volume jumped to $157.8 million over the last day, marking a more than tenfold increase compared with the previous session. Derivatives data from CoinGlass shows a similar shift.
Volume climbed 87% to $21 million, while open interest rose 58% to $1.81 million. When both metrics rise together, it often points to fresh positioning entering the market instead of traders simply closing existing bets.
Buyback launch shifts supply narrative
The rally comes after Lighter confirmed that protocol fees are now being routed directly into token buybacks. In a Jan. 6 statement, the team said all fees generated by its core DEX product and future services would be visible on-chain and allocated between growth initiatives and buybacks depending on market conditions.
On-chain data shows the treasury currently holding roughly 180,000 LIT tokens alongside about $1.35 million in USDC, providing immediate capacity for market purchases. Rather than paying out fees in the form of dividends, the model channels all revenue into buying back tokens.
This approach steadily reduces the circulating supply and links real protocol usage directly to demand for the token. Much of the community conversation has centered on how meaningful the impact could be.
Using current revenue figures, some projections indicate the protocol may be able to repurchase as many as 30 million LIT in the near future, roughly 3% of the total supply. While the actual buyback pace will depend on trading activity, the structure itself has shifted how traders view long-term value capture.
Lighter launched LIT on Dec. 30 following a $68 million funding round at a $1.5 billion valuation, backed by Ribbit Capital, Founders Fund, Haun Ventures, and Robinhood Ventures.
The token has a fixed supply of $1 billion, split evenly between ecosystem incentives and team, and investor allocations. At launch, an airdrop was used to distribute a quarter of the supply, and investor tokens were locked under a three-year vesting schedule.
Lighter price technical analysis
From a technical standpoint, LIT is still riding a short-term uptrend after breaking out of its previous consolidation zone in the mid-$2.60s. The pattern of higher highs and higher lows shows that bullish momentum remains in control, even though the token has stalled slightly near resistance.
The recent rally carried the price toward the upper Bollinger Band at around $3.18, reflecting strong upward momentum. That band is starting to flatten, indicating that the buying pressure is easing and the market may be entering a pause rather than continuing a rapid advance
A quick look at the momentum indicators tells a similar story. The relative strength index pushed into overbought territory near 70, but it didn’t stay there long and slid back into the low 60s. That kind of drop usually reflects some cooling off, not a trend flip. The general bullish trend may continue as long as the RSI is higher than 50.
In the near term, the $3.00 level has emerged as a critical test for sustaining this upward momentum. A clean break above that area could open room for a fresh leg higher. Failure to hold the $2.95 region would likely lead to a deeper retracement toward $2.80, where earlier demand and volatility support sit.
