$40M lifeline? Why Circle-Lighter’s revenue-sharing deal could reignite LIT

Lighter [LIT] perpetual DEX has reportedly reached a revenue-sharing deal with Circle on interest income from USDC deposits on the platform. According to analysts, this could be a key lifeline and bullish catalyst for its ecosystem and native token.

The deal could fetch $30-$40 million in annual revenue, according to projections by Ryan Watkins, co-founder of crypto VC firm Syncracy Capital. Watkins added,

“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.”

Potential impact on Lighter

Since the end of the second phase of farming in late 2025, Lighter’s airdrop farmers have declined, derailing perpetual volumes and Open Interest (OI).

According to DeFiLlama, the DEX’s weekly perp volumes dropped from about $300 billion in November 2025 to below $50 billion in February 2026 – A 6x decline in the past two months.

With slow growth, monthly revenue also fell by nearly half from $24 million in November to $13 million in January. So far in the first half of February, Lighter has generated just $1.7 million, underscoring more pressure on its revenue stream.

Since it also runs buybacks like Hyperliquid, the said revenue-sharing deal could help bolster token accruals and trading fee rebates.

For the unfamiliar, Circle earns interest income on the USDC reserves invested in U.S. Treasury bonds.

For USDC circulating on Coinbase, the exchange nets 100% of the interest income on USDC reserves. Additionally, it captures 50% of the USDC’s income outside its platform, with the deal reportedly generating Coinbase over $900 million in 2024 alone.

Other platforms have pushed to capture similar revenue streams or opt for their in-house stablecoin and keep all interest income. This is what led to Hyperliquid’s native stablecoin USDH.

That said, the specifics on the sharing deal with Lighter and Circle were not public as of press time. However, some market watchers speculate that the deal may be behind the recent trading fee rebates announced by the platform.

For his part, Syncracy Capital’s Daniel Cheung believes that LIT may be “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.”

Will LIT extend its recovery?

LIT surged by 10% after the update, bringing its February recovery gains to 20%.

If the uptrend extends itself, the recovery could hit 33% if the $1.7-level is tagged. On the downside, the trendline support would be a key support to watch.

Final Thoughts

• 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 attract traders to the platform again.