LayerZero Foundation Offers to Acquire Stargate Bridge for $110 Million

LayerZero Foundation Rescues Struggling Token

The LayerZero Foundation, the organization behind the LayerZero protocol, a platform known for its cross-chain messaging capabilities, has gained a foothold in the free finance space by connecting different blockchains such as Binance Smart Chain, Ethereum, and Solana. Stargate, a multi-chain bridge developed by LayerZero and launched in 2022 that enables seamless asset transfers across liquidity pools, was once considered a safe solution for vulnerable bridges. After their previous highs, Stargate’s STG token and LayerZero’s ZRO are now facing downward pressure. Amid the struggling tokens of both projects, the LayerZero Foundation has just made a $110 million acquisition offer for Stargate, marking a potential turning point in the free finance space.

Developments of the 110 million USD deal

The official proposal from the LayerZero Foundation was posted on the Stargate governance forum on August 10, 2025, and was endorsed by CEO Bryan Pellegrino, allowing the event to begin. The proposed transaction involves using ZRO tokens to exchange for STG, at a rate of 1 STG = 0.08634 ZRO, equivalent to $0.1675/STG and $1.94/ZRO at the time of publication. LayerZero will be fully merged into Stargate if the DAO (decentralized autonomous organization) is approved by the Stargate community. This will cause the Stargate DAO to dissolve and the STG token to cease to exist.

This move comes as both STG and ZRO are struggling to maintain their value. STG is down more than 95% from its high of $4.14 in 2022, and ZRO is down 67% from its high of $7.47 in December 2022. Both tokens surged immediately following the announcement; in 24 hours, STG was up about 16.5% to $0.19 and ZRO was up about 23% to $2.44, pushing implied transaction value to about $127 million. Pellegrino said the merger would help “accelerate development” and create a “unified stack” for the LayerZero ecosystem, but the STG community’s reaction showed dissatisfaction with the swap rate and the loss of a staking mechanism.

Impact on STG value

The acquisition could solidify LayerZero’s position as a leading cross-chain hub, leveraging Stargate’s $70+ billion in revenue to increase liquidity and interoperability. This could increase the value of ZRO, especially if Stargate’s revenue is channeled into a ZRO token buyback program. For Stargate, the merger could provide resources for growth beyond their current operations, but it could also end the independence of the STG community, impacting existing investors.

There are many pitfalls to this event. Negative feedback from the STG community, many of whom believe the 1:0.08634 swap is unfair compared to the $939,000 in monthly staking revenue, is likely to result in a vote failure, with at least 70% of voters in favor. Additionally, the price change of both tokens after the announcement may be temporary, and the $110 million transaction value may not be sustained if the cryptocurrency market declines. The transparency of token transactions may be affected by regulations in countries such as the United States or the European Union, especially if the DAO is dissolved. Finally, if LayerZero does not make good use of its new resources, competition from other bridges such as Wormhole or Axelar may lessen the impact.

Conclude

The LayerZero Foundation’s proposed acquisition of Stargate for $110 million on August 10, 2025 is a bold move that reflects its ambition to unify and accelerate development in the DeFi ecosystem. This move could strengthen LayerZero’s position and benefit ZRO in the long term, but success depends on the STG community’s acceptance and ability to overcome objections.

Disclaimer: The information presented in this article is the author's personal opinion on the cryptocurrency field. This is not intended to be financial or investment advice. Any investment decision should be based on a careful consideration of your personal portfolio and risk tolerance. The views expressed in this article do not represent the official position of the platform. We recommend that readers conduct their own research and consult with a professional before making any investment decisions.Disclaimer: The information presented in this article is the author's personal opinion on the cryptocurrency field. This is not intended to be financial or investment advice. Any investment decision should be based on a careful consideration of your personal portfolio and risk tolerance. The views expressed in this article do not represent the official position of the platform. We recommend that readers conduct their own research and consult with a professional before making any investment decisions.