Lighter falls 11% after Bitwise’s LIT ETP launch – But there’s a catch!

Lighter [LIT] rallied toward $5.50 after Bitwise launched its Lighter Staking ETP. But the move was short-lived. Sellers rejected the price near $5.50, and LIT then posted two red daily candles.

The token lost $5 support and fell as low as $4.86. At press time, it traded near $4.87, down 11.2% in 24 hours.

LIT also fell below its nine-day Moving Average, while MACD formed a bearish crossover and dropped to 0.35. Together, the indicators pointed to weakening momentum after the rally.

Why did Lighter fall below $5?

Profit-taking appeared to weigh on LIT after gains of more than 60% over the past month. Exchange Netflow remained positive for four consecutive days, suggesting tokens were moving toward exchanges.

That raised the possibility of more selling, though Exchange Netflow alone cannot establish that holders sold.

Meanwhile, community discussion turned to future token unlocks. The next unlock was still three months away, so the immediate pressure appeared to come from the recent price move.

Can staking help LIT recover?

Learning Pill argued that staking and buybacks could help absorb supply. The analyst said 46% of circulating Lighter [LIT] was staked and more than 6% had been repurchased.

There was a catch in the Bitwise story, though. Its newly launched ETP offered exposure to the altcoin, but the product had not begun staking. Bitwise said staking would start after the ETP reached sufficient assets under management.

For now, the ETP’s potential to absorb the token through staking remains a future possibility.

What price levels matter for LIT?

If selling persisted, LIT could test its 21-day Moving Average near $4.60. Losing that level could bring $4 into focus over the following weeks.

By contrast, easing profit-taking could help the altcoin reclaim $5 and challenge $5.40. That would require buyers to regain ground lost after the ETP launch.

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Final Summary

• Lighter [LIT] fell 11.2% to $4.87 after losing $5 support.
• Bitwise launched a Lighter Staking ETP, but the product had not started staking LIT.