Headline: Circle revenue-sharing deal could be a lifeline for Lighter DEX — analysts optimistic Lighter’s perpetual DEX (LIT) has reportedly struck a revenue-sharing agreement with Circle to receive a portion of the interest generated by USDC deposits on the platform — a development analysts say could be a crucial boost for the struggling exchange and its native token. How the payout could help Ryan Watkins, co-founder of crypto VC firm Syncracy Capital, estimates the arrangement could deliver $30–$40 million in annual revenue to Lighter. “The reason why this is exciting is not because it will directly lead to more buybacks (it will indirectly),” Watkins said. “It’s a subsidy for traders who will now pay less funding on positions. Should increase open interest.” Put simply: interest income from USDC reserves (which Circle earns by investing into U.S. Treasuries) could be shared with Lighter. That extra yield can be used to lower funding costs for traders, potentially increasing open interest and reviving perp volumes — a key health metric for any derivatives venue. Why Lighter needs it Lighter has suffered a sharp slowdown since the second farming phase ended in late 2025. Airdrop-driven liquidity has waned and perp trading volumes and open interest have tumbled. According to DeFiLlama, weekly perp volumes plunged from roughly $300 billion in November 2025 to below $50 billion by February 2026 — a roughly 6x collapse in two months. Monthly revenue tracked the decline, falling from about $24 million in November to $13 million in January. In the first half of February the DEX generated just $1.7 million, highlighting mounting pressure on its top line. (Source: DeFiLlama) Revenue-sharing could also feed token accrual mechanisms such as buybacks and rebates. Lighter operates buybacks similarly to Hyperliquid, and an extra income stream could strengthen tokenomics and trader incentives. Context on USDC interest flows Circle captures interest income on USDC by investing the reserves in short-term U.S. Treasuries. For USDC held on Coinbase, the exchange reportedly keeps 100% of that interest; for off-platform reserves it has captured roughly half the yield, a structure that reportedly generated over $900 million for Coinbase in 2024. Some protocols have tried to replicate this model or issue their own stablecoins (Hyperliquid’s USDH is an example) in order to retain more interest income. Details remain private Specific terms of the Lighter–Circle arrangement have not been made public. Market watchers have pointed to the revenue-sharing deal as a likely reason behind recent trading fee rebates announced by Lighter, but those links are speculative until both parties disclose terms. Market reaction and token outlook Syncracy Capital’s Daniel Cheung argued LIT may be “criminally undervalued.” “The perps category will be bigger than anyone expects and $LIT is criminally undervalued at 5% of HYPE with 10% of its fees,” he said. After news of the arrangement surfaced, LIT jumped about 10%, bringing February gains to roughly 20%. Analysts suggest a continued uptrend could push recovery to 33% if LIT reclaims the $1.70 level, while the trendline support remains the key downside level to monitor. (Source: LIT/USDT, TradingView) Bottom line If the Circle deal provides a meaningful and sustained interest share to Lighter, it could materially improve trader incentives, revive open interest and stabilize revenues — but until terms are disclosed and capital flows are visible on-chain, the impact remains an informed but unconfirmed optimism. Disclaimer: This article is informational and not investment advice. Trading and investing in cryptocurrencies carry significant risk; do your own research before making decisions. © 2026 Read more AI-generated news on: undefined/news

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