LayerZero Secures 110M Stargate Acquisition Amid DeFi Bidding War

LayerZero has secured the $110 million acquisition of cross-chain platform Stargate after a competitive bidding war that attracted multiple high-profile rivals [1]. The deal was approved by Stargate’s decentralized autonomous organization (DAO) with 95% of the vote, reflecting one of the highest participation rates in the protocol’s history. Over 15,000 addresses cast more than 7.5 million veSTG tokens, signaling strong community engagement in what has become a pivotal moment for the DeFi sector.

Under the acquisition terms, Stargate stakers will retain 50% of protocol revenue for the next six months, while the remaining 50% will be allocated to ZRO token buybacks. This structure is designed to balance short-term incentives with long-term token value appreciation. Additionally, STG token holders can convert their tokens into ZRO at a fixed rate of 1 STG = 0.08634 ZRO, starting Monday, Aug. 25 [1]. The transition marks a full integration of Stargate into the LayerZero ecosystem, with governance now centralized under LayerZero’s control.

The road to final approval was not straightforward. LayerZero’s initial proposal faced criticism for ending Stargate’s staking program and for being perceived as undervaluing the platform’s strong revenue-generating capabilities. This sparked a rare multi-protocol bidding war in DeFi, with Wormhole, Axelar, and Across Protocol all entering the fray. Notably, Wormhole offered a $120 million all-cash bid with accelerated payouts for STG holders. Despite these competitive offers, Stargate’s community ultimately chose LayerZero, prioritizing strategic alignment over immediate financial gains [1].

The acquisition is also a return to LayerZero’s origins. The company originally developed Stargate in 2021 before it was spun out as a DAO in 2022. By reacquiring Stargate, LayerZero strengthens its cross-chain infrastructure and reinforces its position as a leading player in the interoperability space. The move highlights the growing importance of cross-chain communication in DeFi, where seamless value transfer across blockchains remains a key challenge.

Now that the acquisition has been finalized, the focus shifts to how effectively LayerZero can integrate Stargate’s infrastructure and whether the combined entity will deliver sustainable value to both ZRO and former STG token holders [1].

Sources:

[1] title1: LayerZero 110M Stargate Acquisition STG Vote 2025

url1: https://crypto.news/layerzero-110m-stargate-acquisition-stg-vote-2025/