LayerZero Foundation to Integrate Stargate: STG Holders to Receive ZRO at Historic Valuation

WhaleWatcher · 2025-12-26T21:56:44+00:00

The LayerZero Foundation plans to acquire the Stargate cross-chain bridge protocol for $110 million, converting STG tokens to ZRO. This move includes dissolving Stargate's DAO, shifting governance, and aims to enhance development and integration within LayerZero's ecosystem.

WhaleWatcher

2025-12-26 21:56:44

Abstract generation in progress

The LayerZero Foundation has unveiled an ambitious restructuring proposal that would bring the Stargate cross-chain bridge protocol under its umbrella through a $110 million acquisition of the STG token and related assets. As reported by The Block on August 11, this strategic move marks a significant consolidation in the interoperability infrastructure space.

Token Exchange and Valuation Mechanics

Under the proposed terms, STG token holders will have their holdings converted to LayerZero’s native ZRO token at a conversion ratio of 1 STG = 0.08634 ZRO. Based on the foundation’s valuation framework, this translates to an effective price of $0.1675 per STG token, with ZRO trading at $1.24 per unit. The exchange mechanism effectively values the entire Stargate ecosystem at the $110 million acquisition price, representing the foundation’s assessment of the protocol’s worth within the broader LayerZero ecosystem.

Structural Integration and Governance Changes

The integration plan involves dissolving Stargate’s existing DAO structure and fully absorbing the cross-chain bridge protocol into LayerZero Foundation operations. This represents a fundamental shift from community-governed token economics to foundation-controlled development and resource allocation.

Strategic Rationale and Future Direction

According to the proposal documentation, the foundation views this consolidation as essential to accelerate development velocity for both protocols. The statement emphasizes that the acquisition will provide Stargate with dedicated resources to execute its development roadmap while simultaneously expanding beyond its original cross-chain bridge functionality. By integrating a protocol that maintains direct user interactions and generates sustainable revenue streams into the LayerZero ecosystem infrastructure, the foundation aims to create deeper integration between consumer-facing applications and core interoperability layers.

The move signals the foundation’s commitment to building a more unified and resource-efficient ecosystem around LayerZero’s omnichain infrastructure, positioning Stargate’s user base and revenue generation capabilities as strategic assets for long-term ecosystem expansion.

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