Lighter's Price Action: Whale Flows vs. Retail Selling Pressure

Lighter's price action is defined by a sharp recent pullback against a backdrop of conflicting on-chain flows. The token is currently trading at $2.77 USD, down 7.63% over the past 24 hours. This follows a strong recovery rally earlier in the week, where it climbed from a $2.50 support level to a peak near $3.20.

The immediate price pressure is being driven by a notable whale selling and hedging activity. One whale sold 52.1 WBTC for $4.86 million and later hedged a $2.2 million LIT purchase by opening a leveraged short position. This represents a clear signal of profit-taking and risk management from a major holder.

This selling is being countered by a significant accumulation push from other whales. Two separate whale wallets have spent a combined $6.25 million to purchase 2 million LIT tokens. This activity, which included a large deposit of USDC into the platform, suggests a battle is underway between whale accumulation and sustained retail selling pressure.

The Buyback Program: A Supply-Side Catalyst

The treasury buyback program is a direct institutional flow that has already begun to support price and reduce circulating supply. The program was announced on January 6, with the treasury immediately using protocol fees to purchase LIT tokens. On-chain data shows the treasury spent over $10,000 in USDC to buy back roughly 180,700 LIT tokens, with the Lighter Assistance Fund also buying 165,790 tokens at an average price near $3.05.

The program's scale is significant, with a stated target of repurchasing up to 30 million LIT. That represents a substantial portion of the current 250 million circulating supply, creating a clear mechanism to tighten liquidity over time. This supply-side catalyst is working in tandem with strong capital flows, as evidenced by the 79% surge in trading volume to $35 million that accompanied the recent rally.

The immediate price impact has been positive, with the token jumping nearly 13% on the day of the buyback announcement. This surge in volume and price action confirms that the buyback is attracting capital and shifting market sentiment. For the price to sustain higher levels, this institutional buying must continue to outweigh the retail selling pressure that remains evident.

Catalysts and Risks: What to Watch

The primary forward catalyst is the execution of the treasury buyback program. The stated goal of repurchasing up to 30 million LIT represents a direct, institutional flow to absorb circulating supply. For the rally to sustain, this program must continue to outpace selling pressure, with the initial on-chain purchases already visible. The program's success will be measured by its ability to tighten liquidity and support price from below.

Key technical levels define the immediate battleground. The price must hold above the $2.95 short-term support to maintain the bullish structure. A decisive break above the $3.60 resistance would signal a continuation of the uptrend, with the RSI at 66 indicating room for further upside before reaching overbought territory. The current setup hinges on whether institutional buying can push through these levels.

The main risk is a failure of the buyback to absorb supply, allowing retail selling to accelerate. Evidence shows sellers' strength holding at +39 while buyers remain negative, creating a distribution zone. If whale accumulation slows and retail pressure intensifies, the price could breach the $2.50 support, reversing the recent gains. The rally's sustainability depends on whether the supply-side support from the buyback can outweigh the persistent retail selling pressure.