LayerZero, a cross-chain protocol, has announced it is acquiring the multichain bridge Stargate Finance for $120 million in ZRO tokens. The deal was overwhelmingly approved by Stargate Finance DAO members.
LayerZero and Stargate Merger
The merger will see LayerZero and Stargate combine under one project, with ZRO becoming the official token for both platforms. 94% of Stargate DAO members approved the deal, indicating strong support. Stargate Finance was created by the LayerZero team in 2021 but later became a separate DAO.
Market Position and Competition
According to Token Terminal, LayerZero has controlled approximately 85% of the market share over the past 12 months. The deal comes amid competitive pressures, including efforts by Wormhole. Wormhole proposed a pause in voting to improve its offer, but the majority of Stargate DAO members backed LayerZero's proposal.
Response to Acquisition and Token Status
Despite the positive developments, the ZRO token has decreased in value. It has declined slightly in the past 24 hours, reflecting overall trends in the crypto market. Both ZRO and STG tokens have shown negative performance, with ZRO down 7.52% over the week and STG down 2%. Both tokens have lost over 50% of their value year-to-date.
The acquisition of Stargate Finance by LayerZero represents a significant step in solidifying its position in the blockchain interoperability ecosystem. The merger of the two projects' capabilities may foster further growth and development for both LayerZero and Stargate.
