LIT Surges 13–37% as Lighter Launches Treasury Buyback Program

• Lighter’s LIT token rebounded 37% from its all-time low on January 1, as the decentralized perpetual futures exchange began its planned buyback strategy according to reports.
• The protocol uses revenues from its exchange product to purchase LIT tokens on the open market, with the Lighter treasury account already holding over 181,000 LIT tokens worth approximately $550,000 as data shows.
• Whale activity, including purchases by a wallet believed to belong to Tron founder Justin Sun, has also contributed to the price movement, with several large entities purchasing millions of dollars worth of LIT according to reports.

Lighter initiated a treasury buyback program in January, allocating 50% of protocol fees from its decentralized exchange and future services to repurchase LIT tokens as reported. This initiative aims to reduce the circulating supply of LIT by up to 3%, directly linking token value to protocol growth. As of January 2026, the treasury had repurchased over 180,000 LIT tokens at a cost of around $550,000, reinforcing transparency and long-term alignment with token holders according to analysis.

The buyback program coincided with a 13–37% price surge in LIT, reaching approximately $3.11. Whale activity further reinforced investor sentiment, with several large entities purchasing millions of dollars worth of LIT. One whale deposited $4.86 million in WBTC to purchase 1.119 million LIT tokens as reported. This demonstrates strong belief in the token’s long-term potential and highlights the growing institutional interest in the token according to analysis.

Despite the positive developments, some investors remain cautious. Large whale holdings can introduce volatility if those entities decide to sell later according to reports. Analysts warned that while the buyback program has driven a price increase, it may not sustain price momentum if early holders continue to sell as noted. Whale selling pressure overwhelmed the rebound, leading to a sharp price drop after breaking a key support level below $2.30 according to market data.

What Drives Investor Confidence in LIT?

Investor confidence in LIT is driven by several factors. The buyback program reduces the circulating supply, potentially increasing token value as the supply decreases as reported. The treasury’s transparency in tracking buyback activity and protocol revenue enhances trust among token holders according to analysis.

Whale activity, such as a $4.86 million WBTC conversion used to purchase 1.119 million LIT tokens, reinforces investor sentiment as data shows. Institutional and high-net-worth investors, including those holding 13.2 million LIT tokens valued at nearly $40 million, demonstrated strong belief in the token’s long-term potential according to reports. This whale activity suggests that institutional players are prioritizing long-term value over short-term volatility as analysis indicates.

Additionally, Lighter’s platform allows users to speculate on crypto price movements with high leverage, combining the speed and usability of centralized exchanges with the transparency and self-custody of DeFi according to reports. This hybrid approach attracts traders who value both speed and security, contributing to the platform’s growing user base and increased demand for LIT.

What Risks and Limitations Should Investors Consider?

While the buyback program and whale activity have driven a price surge in LIT, investors should be aware of potential risks and limitations. Large whale holdings can introduce volatility if those entities decide to sell later according to reports. This is a common risk in the crypto market, where large holders can significantly influence price movements as noted.

The price of LIT has experienced sharp declines after breaking key support levels, indicating increased short-term pressure and a lack of sustained investor confidence according to market data. Despite buyback efforts and product expansions, momentum indicators remain weak, and whale selling intensified downward pressure according to analysis. This volatility can be challenging for new investors who may not be prepared for rapid price swings as reported.

Additionally, the effectiveness of the buyback program depends on the success of Lighter’s platform and the continued generation of protocol fees. If the platform fails to attract and retain users, the buyback program may not generate sufficient revenue to sustain price momentum according to analysis.

In conclusion, while the buyback program and whale activity have driven a significant price increase in LIT, investors should remain cautious and monitor market conditions closely. The potential for volatility and the dependence on the success of Lighter’s platform are key factors to consider before making investment decisions as reported.