LIT Surges as Lighter Protocol Launches Token Buyback Program

• Lighter’s LIT token has surged 37% after the protocol announced a buyback program using exchange fees to repurchase over 181,000 tokens, valued at approximately $550,000.
• Institutional and whale activity, including a $4.86M Bitcoin-to-USDC conversion, added upward pressure to the price, contributing to a potential price target near $3.60.
• On-chain data and technical indicators indicate accumulation rather than speculative buying, reinforcing confidence in token holders' long-term value.

Lighter’s LIT token surged 37% from its January 1 all-time low as the protocol announced a buyback program funded by exchange fees. Over 181,000 LIT tokens have been repurchased, and the token functions as a governance and staking mechanism according to market reports.

On-chain data confirmed that the Lighter treasury spent $10,000 in USDC to repurchase tokens, and the Lighter Assistance Fund added further repurchases as reported. A newly created wallet deposited 2.89 million USDC into Lighter and used it to purchase 991,458 LIT tokens at $2.92, signaling growing institutional interest.

Additionally, a $4.86 million Bitcoin-to-USDC conversion was used to buy 1.119 million LIT tokens, contributing to upward price pressure. The token is currently trading around $3.09, with potential upside targets near $3.60.

What Drives the Price Movement of LIT?

The price movement of LIT is driven by a combination of on-chain buyback activity and whale transactions. The Lighter treasury account has accumulated over 181,000 LIT tokens, valued at approximately $550,000. Trading volume surged by 89%, reaching around $36 million, signaling renewed interest from both retail and institutional traders.

Whale activity also contributed to the price rally, with one transaction involving a $4.86 million Bitcoin-to-USDC conversion used to purchase over 1.119 million LIT tokens according to on-chain data. LIT broke key resistance near $2.60, forming a bullish structure with potential upside targets near $3.60.

What Risks Does the LIT Price Face?

Despite the upward momentum, the LIT price faces risks from large holder liquidity and market volatility. The buyback strategy aims to reduce supply and boost value, but competition from platforms like Hyperliquid and Aster remains a challenge. Institutional activity, including a $3.36 million USDC deposit into Lighter, has driven the rally.

Technical indicators, such as the Chaikin Money Flow, suggest rising accumulation rather than speculative buying. While the buyback strategy supports short-term bullish sentiment, risks from large holder liquidity and broader market volatility persist. The success of the buyback program is seen as a key factor in LIT's growth, with continued activity expected to drive long-term value for token holders.