LayerZero has officially acquired Stargate Finance with a 95% approval from Stargate DAO, following competitive bids from Wormhole, Axelar, and Across Protocol.
This acquisition solidifies LayerZero’s position in cross-chain technology, impacting token swaps and market dynamics as competitors vie for cross-chain integration supremacy.
The Stargate DAO has approved the acquisition of Stargate Finance by LayerZero, with nearly 95% of votes in favor. This decision integrates the cross-chain protocols under the LayerZero brand, introducing a token swap from STG to ZRO.
LayerZero, led by CEO Bryan Pellegrino, will consolidate Stargate’s operations. Founded in 2021, Stargate has facilitated over $70 billion in cross-chain transactions. Competing bids from Wormhole, Axelar, and Across Protocol were rejected during the process.
Acquisition Valued at $110–$120 Million Amid Rival Bids
The acquisition, valued at approximately $110–$120 million, includes a token swap where 1 STG converts to 0.08634 ZRO. Wormhole Foundation expressed interest, claiming Stargate was undervalued, but the DAO’s decision remained firm. Bryan Pellegrino, Co-Founder & CEO, LayerZero Labs, said, “Stargate DAO members have approved LayerZero’s acquisition. STG holders will be able to convert to ZRO on Monday.” source
Potential outcomes could involve changes in TVL and liquidity as the market reacts. Historical trends suggest initial volatility coupled with eventual stabilization, influenced by developer integration and community sentiment towards unified governance and interoperability.
Expert Views on LayerZero and Stargate Market Impact
Stargate’s acquisition by LayerZero bears similarities to Yearn Finance’s protocol mergers, which initially led to volatility before settling. Such moves can lead to increased competition in the cross-chain market, as seen with Compound.
Experts from Kanalcoin highlight that swift developer integration and positive community sentiment tend to stabilize affected markets after initial disruptions. This event suggests an escalation in cross-chain competition and could reshape market dynamics, aligning with historical patterns.
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