LIT’s $40M Circle Deal: A Spark or a Damp Squib?

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Ah, the eternal dance of capital and greed! Lighter [LIT], that beleaguered perpetual DEX, has reportedly clutched at a straw-a revenue-sharing deal with Circle, no less. The prize? A pittance of $30-$40 million annually from the interest on USDC deposits. A lifeline, they say. A bullish catalyst, the analysts croon. But is it not merely a drop in the ocean of their woes?

Ryan Watkins, that sage of Syncracy Capital, proclaims with a straight face,

“The reason why this is exciting is not because it will directly lead to more buybacks (it will indirectly). It’s a subsidy for traders who will now pay less funding on positions. Should increase open interest.”

Exciting? A subsidy? Pray tell, is this not the financial equivalent of a band-aid on a gaping wound?

The Plight of Lighter

Since the farming frenzy of late 2025, Lighter’s airdrop peasants have fled, leaving perpetual volumes and Open Interest (OI) to wither like a forgotten cabbage patch. DeFiLlama, that harbinger of doom, reports a sixfold decline in weekly perp volumes-from $300 billion in November 2025 to a paltry $50 billion in February 2026. A tragedy, indeed.

Revenue, too, has plummeted like a lead balloon-from $24 million in November to a mere $13 million in January. And in the first half of February? A laughable $1.7 million. Ah, the sweet scent of desperation!

Yet, they persist with their buybacks, like a gambler throwing good money after bad. This Circle deal, they hope, will bolster token accruals and trading fee rebates. A fool’s errand, perhaps?

Circle, that master of the stablecoin realm, earns its keep from USDC reserves invested in U.S. Treasury bonds. Coinbase, its partner in crime, nets 100% of the interest income on USDC reserves within its walls and a tidy 50% from the outside-a cool $900 million in 2024 alone. A lucrative racket, is it not?

Other platforms, not to be outdone, have opted for their own stablecoins, keeping all the spoils. Hyperliquid’s USDH comes to mind. But Lighter? They’ve chosen the path of dependency, like a beggar at the gates of Circle.

The specifics of this deal remain shrouded in mystery, though some whisper that it’s behind the recent trading fee rebates. Daniel Cheung of Syncracy Capital, ever the optimist, declares LIT “criminally undervalued” at current levels.

“The perps category will be bigger than anyone expects and $LIT is criminally undervalued at 5% of HYPE with 10% of its fees.”

A bold claim, but will it age like fine wine or sour milk?

The Flickering Flame of LIT

LIT, that beleaguered token, surged by 10% on the news, bringing its February gains to a modest 20%. If the gods of the market smile upon it, a 33% recovery could be in the cards. But beware the trendline support-a fragile crutch in stormy seas.

The Bitter Aftertaste

  • Lighter has reportedly reached a deal with Circle to share interest income revenue generated by USDC circulating on the platform.
  • Analysts believe the deal could help drive fee rebates and lure traders back to the platform-a Hail Mary pass, if ever there was one.

In the end, is this deal a spark that will reignite LIT’s flame, or merely a damp squib in the annals of crypto history? Only time will tell, dear reader. Only time.

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2026-02-13 21:11