Lighter outpaces HYPE & ETH, but can it hold on to its 13% gains?
Examining why Lighter has been making new highs over the last three days.
Lighter [LIT] surged by another 13% in the last 24 hours, its third consecutive green day. The altcoin made a new local high of $4.67, with trading volume surging after the perpetual DEX was built into Robinhood Wallet.
The perpetual DEX is slowly but steadily closing on the gap that exists between it and Hyperliquid [HYPE].
LIT outpaces HYPE and ETH
Lighter has performed better than both Hyperliquid and Ethereum [ETH]. On the charts at press time, Lighter was up 465%, followed by HYPE with 136% and ETH a distant third with 24% returns.
Over the past five months, the altcoin has outperformed both HYPE and ETH combined.
The correlation coefficient of Lighter with HYPE was 0.85, reinforcing the growing DEX adoption. Similarly, HYPE has been surging, but its gains have been smaller compared to those of Lighter.
Over the past two weeks, bulls have been consistently buying LIT, as seen in the Open Interest (OI). Since the start of September, the OI has risen from $138 million to about $180 million.
At the time of writing, the price action was yet to outline key levels. However, it has stayed above the Supertrend since 10th April on the daily chart. The sideways channel is the most recent area of interest, with the same trading between $3.20 and $3.85.
At press time, the market cap of Lighter was roughly $1.09 billion, while that of HYPE was $21.92 billion. In fact, the altcoin is 21 times smaller than HYPE by capitalization, but that gap may be slowly but steadily reducing.
And yet, despite this gap being wide, Lighter is helping cement the DEX sector as a major crypto narrative.
Robinhood effect spreads to the Lighter ecosystem
The Robinhood effect has fueled the altcoin’s recent gains. The integration of Lighter into Robinhood Wallet has increased network activity, resulting in more fees.
The protocol’s fees rose from $124K to $195K in the last 24 hours alone, as per DefiLlama. These fees buy back LIT, creating demand and reducing the token supply available in the market.
For the recent surge, short liquidations amplified the gains. This was evident as it sustained a negative Funding Rate during its breakout.
However, that is not all there is.
According to Etherscan, the Transfer Count rose from 1,914 on 29th August to 6,196. This was equivalent to tripling its network activity in six days.
Here, it’s worth noting though that the data did not guarantee that the altcoin’s gains will hold.
Final Summary
- LIT surged by 13%, making a new peak of $4.67 as it outpaced HYPE and ETH in the last five months.
- The Robinhood effect has been driving Lighter’s network activity lately.
