The native token of the Ethereum-based perpetual futures exchange Lighter, LIT, has experienced a sharp decline of over 15% in the last 24 hours, falling below the $1.70 price level. This drop occurred despite the platform reporting strong underlying trading activity and an ongoing token buyback program.
The selloff aligns with a broader crypto market correction, notably a dip in Bitcoin from $95,000 to $92,000 over the weekend before stabilizing near $93,000. However, LIT's struggles are compounded by specific post-airdrop dynamics. Following its launch on December 30, 2025, Lighter distributed a massive $675 million LIT token airdrop, the tenth largest in crypto history. Initial euphoria has given way to a significant slump, with weekly trading volume on the platform plummeting nearly threefold from its December peak of over $60 billion to approximately $25 billion.
On-chain data reveals that airdrop recipients are a primary source of selling pressure, with over 15 million tokens sold in the past week. This has contributed to LIT printing a fresh all-time low near $1.90, a stark decline from its post-debut peak above $4.00. Despite nearly half of airdrop recipients holding their tokens, buy-side demand has been insufficient to counter the sell-off.
In response, the Lighter team has been executing a buyback program announced on January 6, 2026, purchasing a total of $2.8 million worth of LIT tokens, with $1.7 million of that occurring recently during the price decline. The platform's fundamental metrics remain notable but show signs of strain. Lighter recorded $2.25 billion in 24-hour trading volume, ranking third behind rivals Hyperliquid ($2.7B) and Aster ($4.5B). Its open interest stands at $1.31 billion, also in third place, trailing Aster ($2.6B) and the market leader Hyperliquid ($8.9B).
The competitive landscape is shifting as Hyperliquid has reclaimed the top spot in decentralized derivatives, processing over $40 billion in weekly volume. This highlights the challenge for Lighter in transitioning from "incentive-driven" volume fueled by the airdrop to building a durable, sticky user base. The platform's recent introduction of mandatory staking for certain liquidity pools, intended to stabilize the ecosystem, has reportedly prompted some user withdrawals.
