Lighter (LIT) Token Surges 13–37% as Buyback Program Reduces Supply

• Lighter (LIT) launched a buyback program allocating 50% of protocol fees from its DEX and future services to repurchase tokens, aiming to reduce circulating supply by up to 3%.
• On-chain data shows that Lighter’s treasury account has repurchased over 180,000 LIT tokens at a cost of around $550,000. Whale activity, including a $4.86 million WBTC deposit to acquire 1.119 million LIT tokens, has driven increased trading volume.
• The buyback program has resulted in a 13–37% price surge for LIT, with the token reaching approximately $3.04 in early January 2026.

Why Is the Buyback Program Significant for LIT Holders?

Lighter’s buyback program is designed to align token value with protocol usage by reducing supply and creating sustained buying pressure. This strategy reflects broader DeFi trends of using tokenomics to stabilize and enhance value for holders.

The initiative has already seen the protocol treasury repurchase over 180,000 LIT tokens, funded by $1.35 million in USDC. Analysts suggest that if the program continues at this pace, it could further enhance LIT’s appeal to both retail and institutional investors.

What Are the Risks and Limitations of the Buyback Strategy?

While the buyback program has driven a significant price surge, its success depends on maintaining high protocol fees. Some critics argue that concentrated whale holdings may introduce volatility, especially if large holders decide to sell their positions.

Additionally, the broader crypto market conditions, including Bitcoin’s recent price movement, could influence LIT’s performance. If trading volume drops or fees decline, the impact of the buyback program may be limited.

What Is the Current Market View on Lighter’s Strategy?

Analysts and investors have generally responded positively to the buyback program, citing improved technical indicators. Whale transactions have also added further upward pressure, with one whale still holding $193,717 in USDC for potential further LIT purchases.

The Lighter treasury now holds over $548,000 in LIT tokens, according to on-chain tracking. This transparency reinforces confidence among token holders and contributes to a bullish sentiment.

The program builds upon Lighter’s $68 million funding round in December 2025, which valued the protocol at $1.5 billion. These funds are expected to support further buybacks and ecosystem expansion.

Conclusion

Lighter’s buyback program represents a strategic move to stabilize and increase the value of the LIT token. By reducing supply and creating direct demand through protocol usage, the initiative aligns with DeFi trends and offers long-term appreciation potential for token holders. However, its success will depend on maintaining protocol fees and avoiding volatility from concentrated ownership or market conditions.