The Wormhole Foundation plans to respond to LayerZero's $110 million acquisition proposal for Stargate by pausing the vote to prepare a competitive bid.
Introduction to the Stargate Conflict
The Wormhole Foundation's decision to pause the vote aims at preparing a higher bid for Stargate, a crucial player in the cross-chain bridge market.
Wormhole's Critique of Stargate Valuation
On August 21, BlockBeats News reported that Wormhole criticized LayerZero’s valuation of Stargate, suggesting it underestimated the bridge's growth potential. Their demand for a five-day pause on the voting process reflects their intent to prepare a more lucrative offer. This development significantly impacts Stargate's governance procedures.
Implications for DeFi and Governance
The proposed acquisition could change Stargate’s governance, as STG tokens would be phased out, and holders would exchange them for ZRO tokens. Market reactions to this proposal have already been observed, affecting token values and prompting volatility. Coincu analysts emphasize that this bid war could invite regulatory scrutiny due to its impact on governance structures in decentralized finance.
The rivalry between Wormhole and LayerZero for control over Stargate raises important questions regarding asset valuations and management in DeFi, potentially leading to new market strategies.
