The LayerZero Foundation, responsible for cross-chain interoperability protocol LayerZero (ZRO), has submitted a $110 million proposal to acquire the Stargate bridge and its STG tokens. This strategic move seeks to integrate Stargate into the broader LayerZero ecosystem. “This proposal aims to accelerate development of both Stargate and LayerZero, provide resources for Stargate to aggressively execute on a expanded roadmap, and incorporate a powerful revenue-generating protocol that directly impacts end users in the LayerZero ecosystem,” states the Foundation.
Under this acquisition, STG tokens will be terminated, with investors receiving exchange options for ZRO tokens at a set rate of 1 STG = 0.08634 ZRO, equivalent to $0.1675 per STG and $1.94 per ZRO. Stargate will be absorbed into the LayerZero Foundation, while the Stargate DAO will be dissolved.
This acquisition proposal comes after Stargate’s rise as one of the most popular bridges in the industry, boasting over $70 billion in transaction volume. However, STG’s price has since dropped below its peak of $4.14 following launch and fell below $0.20 before recovering to $0.188 with ZRO experiencing a 15% surge. This acquisition is valued at approximately $127 million.
The proposal will be open for community discussion on the Stargate DAO forum for seven days, prompting debate amongst some members regarding the proposed offer’s attractiveness for STG holders.
*This is not investment advice.*