LIghter (LIT) Stages a Strong Rebound: What Did Last Night's Earnings Call Reveal?
Original | Odaily (@OdailyChina)
Author | Azuma (@azuma_eth)
Last night, decentralized perpetual contract exchange Lighter (LIT) held its Q3 investor call via webcast. As one of the rare projects in the industry that discloses information to the standards of a publicly listed company, Lighter's call last night gave investors an opportunity to gain further insight into Lighter's current progress on compliance, products, ecosystem partnerships, and other fronts.
Driven by the positive news disclosed during the call, LIT surged overnight to around $4, and as of publication is trading at $3.65, up 7.23% over 24 hours.
Below are the core takeaways from the call, compiled by Odaily based on the video. The live broadcast ran about 41 minutes, with the first 26 minutes dedicated to project disclosures by Lighter founder and CEO Vladimir Novakovski, followed by 15 minutes of Vladimir answering various topics of interest to the community.
CEO Disclosures
1. Q3 Core Data Overview
In Q3, Lighter's total trading volume reached $137.67 billion; open interest also grew substantially, roughly doubling quarter over quarter — as of September 30, total open interest across Lighter Core and Lighter Robinhood exceeded $1.64 billion.
On the token side, we repurchased 2.45 million LIT in Q3, and those LIT have already been burned on Ethereum.
Lighter Core's total account count has surpassed the 1 million mark; as of the end of Q3, Lighter Robinhood had nearly 40,000 accounts. Notably, nearly 70% of the open interest on the Robinhood instance is concentrated in RWAs. So we can see that Lighter Core continues to attract a higher proportion of crypto-native traders, while Lighter Robinhood attracts a higher proportion of RWA traders.
In Q3, Lighter's total revenue was $8.55 million. Compared with the previous quarter, Lighter's effective take rate rose — roughly 0.5 basis points (bps) last quarter, now about 0.62 basis points, meaning stronger revenue generation capability. Worth special mention is Lighter Robinhood, which launched just one quarter ago. As of the end of Q3, open interest on Lighter Robinhood was close to $500 million ($454.1 million), and after the 50/50 split, trading fees attributable to Lighter already exceeded $1.1 million.
In Q3, we also did a lot of work to expand revenue sources. While standard trading remains free, Lighter is doing more to serve "prosumer"-type traders. For example, Lighter has launched advanced order types, which now carry a 1 basis point (1 bp) fee; at the same time, for traders who place great value on lower latency, Lighter has added additional membership tiers (Plus and Premium), which directly drove up the premium taker share — from 13.1% at the end of Q2 to over 18.2% at the end of Q3.
2. Partner Expansion
Building on the progress made in Q3, we will enter partnerships with more partners in Q4. We will announce these partnerships one by one as they officially go live, but today we can outline roughly what types these partnerships fall into:
- The first category of partners is crypto wallets: These users are themselves crypto-native, already using a wallet product, and want to trade perpetual contracts at low cost, low latency, and with all the quality features Lighter offers. Through integration, they can trade directly within the wallet product. Several such integrations already went live in Q3, and some larger ones in the same category will launch in Q4.
- The second category is centralized exchanges: The potential market is not limited to wallets — zoom out a bit and it's centralized exchanges. We recently spent a few weeks in Asia meeting with many partners in this category. Essentially, centralized exchanges want to provide better liquidity to their customers and offer perpetual contracts and other derivatives trading in a cost-effective, easy-to-integrate way. Several such partnerships are already in progress, with more to come.
- The third category is US financial apps: Going further, once our US instance officially launches, Lighter can integrate not only with crypto-native wallets or centralized exchange-type products, but also cover a broader market. For example, people who want to trade pre-IPO perpetual contracts, or who want 7×24 on-chain options trading, can actually do so through "US-native financial apps" that integrate with licensed exchanges. While all of the above market opportunities are important, the third direction is what Lighter has been working toward for a long time, spanning our infrastructure, technology, and regulatory strategy.
In addition, Lighter's go-to-market team has grown considerably, enabling us to work in parallel across all these verticals.
3. Buybacks and Unlocks
Lighter began executing its buyback program at the start of this year, using 100% of trading revenue to repurchase LIT.As of the end of Q3, Lighter has cumulatively repurchased more than 18.09 million LIT, of which 2.45 million were repurchased in Q3; we also recently announced that the number of tokens burned through buybacks has exceeded 7% of the initial 250 million circulating supply.
At the same time, 109.8 million LIT are currently staked, accounting for 47.3% of the remaining circulating supply — also a fairly considerable proportion.
Another key event is the token unlock. Lighter published the specific unlock rules at the time of its TGE (token generation event), so let's recap here — Lighter has no cliff unlocks; all unlocks will be completed linearly over 36 months.
The first unlock will occur on January 29, 2027. Over the past few months, we have been actively communicating on this matter with existing equity/token cap table investors, so we are very clear on where everyone stands. The vast majority of existing investors are highly long-term-oriented investors whose asset allocation thinking will not be affected by these unlocks, but at the same time, a very good opportunity has emerged to bring in new strategic investors (such as some of the large partners mentioned earlier) — in the course of working with Lighter, they very much want to allocate LIT tokens at scale, with demand far exceeding what they can buy directly in the secondary liquid market.Therefore, we can use the small portion of existing investors who are willing to participate to bring in these strategic investors, and we are currently advancing this process.I think this will be a win-win outcome, allowing us to bring in strategic investors while achieving large business partnerships.
4. Technical Progress
On the technical side, this quarter Lighter made very significant progress in reducing zero-knowledge proving costs. Since the start of this year, Lighter has reduced overall proving costs by more than 50%, with the efficiency of internally built circuits and business logic improving 3 to 4 times; another very important metric is that average block proof time has been shortened from over 5 minutes to about 1 minute, equivalent to an 81% reduction in time.
Lighter has also invested more in open source, particularly having open-sourced a client foundation library for building on Lighter, which has greatly contributed to the rapid launch of many recent partners.
LighterEVM has also made great progress. We have expanded the architectural design of LighterEVM so that it can now perform synchronous reads from Lighter Core, conduct asynchronous transfers and order management, and support fully on-chain vaults, RFQs, fiat onramps, and trading applications. At the same time, all standard EVM tooling can be used directly, with settlement on Ethereum via ZK.
We plan to launch the LighterEVM mainnet before the end of this year, and we are very pleased with our collaboration with Axiom in this regard. In the early testnet Beta version, we collected a great deal of feedback, and the synchronization performance is now stronger, able to support more kinds of applications running smoothly on LighterEVM. Launching the mainnet before year-end is one of our core engineering team's top priorities for Q4.
5. Options Products and Unified Margin
Another top priority for us is options. I believe many of you have seen that we just launched binary options this week. Binary options are just a starting point; currently they support price-based contracts.
What we are developing next is vanilla options — the calls and puts that are so important in traditional finance (TradFi), i.e., European-style options. We recently recruited several key people in this area — of course I myself traded options many years ago, but now we have dedicated team members pushing this forward full-time on the technical, liquidity, and product sides.Our timeline is to launch vanilla options before the end of this year.
Related to options, we have been building a unified risk engine that allows spot, perpetuals, and options to have margin calculated jointly. This feature will launch alongside vanilla options at the end of this quarter.
A brief explanation of this feature. Currently, although collateral is shared within an account, the margin requirement for each position is calculated independently; after introducing portfolio margin, Lighter will evaluate spot, perpetuals, and options under the same asset together, calculating what the worst realistic loss would be if the market moves dramatically. If a user holds positions that hedge each other — for example, being long a call option while short a perpetual contract — this should logically be more capital-efficient than holding these two independent positions separately. Because the worst-case loss is smaller, less margin needs to be posted.
This will bring significant capital efficiency improvements and is also the standard way professional trading institutions run options books. Since all these trading instruments run on Lighter, the entire portfolio can operate without moving collateral back and forth. This not only improves capital efficiency for ordinary users but also for market makers — when market makers' capital efficiency improves, they can quote tighter spreads and deeper books, which in turn benefits retail traders.
6. Regulatory Progress
Now turning to the regulatory side. Our communications with the US Commodity Futures Trading Commission (CFTC) are continuing to move forward.
In August of this year, I was honored to attend the first meeting of the CFTC's Innovation Advisory Committee.During the meeting, we also continued to advance communications directly with the CFTC Chairman's office and various relevant departments, discussing our licensing path. This licensing path will actually cover both perpetuals and options, since both are regulated by the CFTC.
Why are we doing this? Why is it so important? Because expanding retail and institutional participation in the United States — the world's largest financial market — will open up enormous market opportunities for Lighter and on-chain trading. Therefore, our team has invested a great deal of time in this area, insisting on "going in through the front door," spending time going through the rules line by line with the various CFTC departments.
Our current goal is to obtain DCM (Designated Contract Market) and DCO (Derivatives Clearing Organization) licenses.
- DCM is the license that allows you to operate a trading market; functions such as order book management fall under DCM;
- DCO is the license used for market clearing; for example, how liquidation mechanisms work, how auto-deleveraging (ADL) works, and so on, all fall under DCO.
We have spent a lot of time going through the core principles line by line with CFTC staff — 23 core principles for DCM and 18 core principles for DCO. Many of these principles can already be mapped very clearly to how Lighter implements things on-chain under the existing regulatory framework; for some other principles, our approach is a "novel implementation," which is new to regulators, but they have now spent a lot of time communicating with us to understand how it works.
This is the "pre-engagement" work we have been doing.The plan going forward is that we will formally submit the license applications next month (November 2026); after submission, regulators have a statutory review period of up to 180 days. Because we have already completed all this preparatory work, we expect the subsequent review process to be very smooth.We are very excited about obtaining these licenses in the US and fully opening up to retail and institutional participants in the US market. This is currently a very important priority for our team.
Investor Q&A Session
Prior to this call, Lighter had solicited questions from investors via a public link. During the meeting, Lighter's head of investor relations, Trevor King, presented to Vladimir the questions that received relatively high vote counts on behalf of investors, as well as questions mentioned in investor comments during the livestream.
Q1: How to respond to AI-driven hacker attacks and security assurance?
Trevor: It's a great honor to join today's meeting. If there is anyone listening online who hasn't spoken with me yet, please feel free to reach out — I'd be very happy to connect. We received many questions about security. Someone asked: "We see more and more AI-driven hacker attacks in the news — how does the Lighter team think about security?"
Vladimir: Yes, this is a very important question. By the way, security and AI are also topics we discussed extensively at the CFTC advisory committee meeting and across the industry.I think we are in a very favorable position on security because we adopt a security-in-layers approach.As an Ethereum L2, this security structure was embedded in our architecture from the very beginning.
- Multiple cross-verification (Swiss cheese model): Every state change on Lighter is first executed by the sequencer, then proven by ZK circuits, and finally verified by our smart contracts on Ethereum, with guardians also checking in between. This means the sequencer and the circuits enforce the same rules through two separate code implementations, forming a cross-check against each other. We call this the "Swiss cheese model" — a great deal of redundant protection is built into the architecture.
- Internal and external security audits and AI formal verification: On top of that, we continuously carry out security reviews and testing together with internal and external security teams. As everyone knows, before founding Lighter, our team itself worked on AI development, so we are very familiar with various AI tools and have a deep network in this field. We are currently using AI tools very actively — from basic testing to formal verification, using these tools to formally verify our most core components.
- Settlement time window buffer: Finally, our architecture also provides a natural security time window. Because there is a certain amount of time between trade execution and finalization on Ethereum, if any abnormal situation really occurs, we have ample time to monitor abnormal activity and respond before funds actually move on Ethereum.
Of course, there is always a great deal of work to be done in security, and it is our top priority, but I think given the underlying architecture with which we built Lighter, plus our past experience in AI, the combination of the two provides us with a very solid security assurance.
Q2: How does joint settlement between Lighter Core and LighterEVM work?
Trevor: We actually received several questions about the EVM as well. One asked: "Very curious about the joint settlement between Core and LighterEVM. Combining the two into one proof — how exactly does that help in terms of interoperability, cost, or security?"
Vladimir: Okay, let me explain in detail how it works. Every EVM block points to the latest available Core state version. Asynchronous transfers and orders work in such a way that Core executes them in its own sequence, and EVM calls do not need to wait for their results, nor do they block other Core transactions.
Once both sides have submitted data to their respective inboxes and outboxes, we have a component called the aggregation circuit, which enforces that the data on both sides are exactly equal. As a result, only one zero-knowledge proof is ultimately needed to settle both Lighter Core and LighterEVM states to Ethereum simultaneously.
This brings enormous efficiency gains — no cross-chain bridge needed; no new trust assumptions introduced; only one verification on Ethereum L1 instead of two. This design not only significantly reduces costs but also reduces latency between the two.
