LayerZero has finalized the acquisition of the Stargate platform for $110 million following intense bidding wars with other offers.
DAO Support and Deal Terms
The acquisition of Stargate was approved by the Stargate DAO with a record participation rate of 95%. More than 7.5 million veSTG tokens were voted on by over 15,000 addresses. As part of the deal, the DAO has been dissolved, and governance will be transferred to the LayerZero ecosystem.
Prospects for Stargate under LayerZero
Under the final agreement, Stargate stakers will receive 50% of protocol revenue over the next six months. The remaining 50% will be used for ZRO token buybacks, which is expected to strengthen token value. STG token holders will have the option to convert those tokens into ZRO at a fixed exchange rate.
Competition with Other Bids
Securing approval was not an easy process. LayerZero's initial proposal faced criticism for allegedly underestimating Stargate's strong revenue generation. This led to a rare multi-protocol bidding war. Offers from Wormhole, Axelar, and Across did not sway the community vote, leading them to choose LayerZero.
The completion of this acquisition emphasizes Stargate's strategic importance for LayerZero's ecosystem and opens new avenues for improving cross-chain messaging and liquidity in DeFi.
