The price of Lighter (LIT) made a significant leap over the past 24 hours, breaking through the $5.30 mark and setting a new local high. This came on the back of a more than 50% gain over seven days, as buyers aggressively reclaimed control of the price. However, by the time of publication the situation had reversed: LIT dropped 6% from its recent highs.
The rapid rise of LIT was driven by several key factors. First, market participants massively moved tokens from exchanges to Lighter staking addresses. For example, more than 140,000 LIT were purchased on OKX and Bybit and withdrawn to a single address, then bridged to the Lighter network. This whale's staking portfolio exceeded 6.598 million LIT worth $31.63 million. Overall, more than 110 million LIT were locked in staking, representing 44.2% of the circulating supply. Second, the Lighter protocol was conducting buybacks of its own tokens for burning: since the TGE (token generation event), 17.50 million tokens, or 7% of the circulating supply, had been repurchased. Third, the decentralized exchange allocated 11 million tokens for farming rewards, boosting network activity. In addition, open interest (OI) in LIT crossed the $1 billion mark, reflecting aggressive buying of futures contracts by traders. Trading volume in August exceeded $39.5 billion on a monthly basis. Part of this activity spike was triggered by Lighter's integration into Robinhood Chain.
After LIT broke the psychological $5 level and set a new peak above $4.90, the asset began to surrender its gains. Technical indicators initially confirmed the bullish trend: the Technical Ratings signaled a "strong buy" on daily and weekly timeframes, while a sell signal appeared for the six-month period. The Bollinger Bands, which began to widen, pointed to growing volatility. However, shortly after reaching the new high, the LIT price started to pull back, losing a support level and coming under bearish pressure. This outcome was partly the result of profit-taking by large token holders.