LayerZero to Acquire Stargate Bridge in $110 Million Cross-Chain Consolidation Deal

Generated by AI AgentCoin World
Sunday, Aug 10, 2025 3:03 pm ET1min read
STG
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Aime RobotAime Summary

- LayerZero Foundation proposes $110M acquisition of Stargate bridge to consolidate cross-chain infrastructure amid STG token's declining value.

- STG holders can exchange tokens for ZRO at 1:0.08634, triggering 12% STG price rise and 15% ZRO surge post-announcement.

- Acquisition aims to unify cross-chain services but faces governance concerns and skepticism over STG's undervaluation despite $70B historical volume.

- The deal reflects blockchain industry consolidation trends, with success dependent on integration execution and maintaining user relevance in competitive DeFi markets.

LayerZero Foundation has proposed an $110 million acquisition of

Stargate
bridge, a cross-chain liquidity protocol, as the
STG
token continues to face declining value and weak market performance. The offer, announced in the Stargate DAO’s community forum, includes the discontinuation of the STG token, with holders able to exchange their tokens for ZRO, LayerZero’s native token, at a rate of 1 STG to 0.08634 ZRO, representing a value of $0.1675 per STG. The move aims to consolidate cross-chain capabilities and accelerate development across the ecosystem [1].

The acquisition is framed as a strategic effort to enhance LayerZero’s infrastructure and provide Stargate with greater resources to expand its functionality beyond bridging. According to the proposal, Stargate is currently the most-used cross-chain bridge, with over $70 billion in historical volume. Despite this, the STG token, which reached an all-time high of $4.14 in 2022, has since fallen to below $0.20 [1]. Following the announcement, STG’s price rose approximately 12%, reaching $0.188, while ZRO climbed about 15%, pushing the total value of the deal to roughly $127 million at current prices [1].

LayerZero CEO Bryan Pellegrino emphasized the importance of speed and integration, stating the goal is to create a unified stack that developers and users can adopt across the LayerZero ecosystem. The dissolution of Stargate’s DAO and its absorption into LayerZero Foundation raises questions about governance and token holder compensation. Some community members have expressed concerns that the offer undervalues STG, particularly given the protocol’s revenue potential and past price performance [1].

The acquisition reflects a broader trend of consolidation in the blockchain space, where foundational protocols seek to streamline operations and reduce dependencies on external infrastructure. For LayerZero, bringing Stargate in-house could strengthen its competitive position by unifying cross-chain services and improving developer experience. However, the success of this move will depend on execution, including how well the integration is managed and whether it can attract and retain users [1].

From a market perspective, the deal highlights both the challenges and opportunities in cross-chain DeFi. While Stargate has established itself as a key bridge, the STG token’s struggles underscore the difficulties in sustaining token value in a competitive and volatile market. A successful integration with LayerZero could provide a much-needed boost, but it will require innovation and strong community support to maintain relevance [1].

Source: [1] LayerZero Foundation Proposes $110 Million Acquisition of Stargate Bridge as Token Struggles (https://www.theblock.co/post/366246/layerzero-foundation-proposes-110-million-acquisition-of-stargate-bridge-as-token-struggles?utm_source=rss&utm_medium=rss)