LayerZero Proposes $110 Million Stargate Bridge Acquisition
LayerZero Foundation proposed acquiring Stargate cross-chain bridge for $110 million on August 10, 2025. According to BeInCrypto, the proposal would dissolve Stargate DAO and convert all STG tokens to ZRO tokens. Each STG token becomes redeemable for 0.08634 ZRO through a fixed-rate redemption contract. The conversion rate values STG at $0.1675 based on ZRO's $1.94 market price.
The proposal requires 70% approval from STG holders to pass. LayerZero CEO Bryan Pellegrino said the acquisition would give Stargate resources to ship on an aggressive roadmap. Stargate launched in 2022 and has facilitated over $70 billion in cross-chain transfers. The bridge currently generates substantial revenue, with $939,000 in payouts to STG stakers over the past three months.
Why This Matters For Token Holders
Both tokens rallied immediately after the announcement. STG surged 12% to $0.188 while ZRO gained 15% to reach new highs. The price movements increased the deal's implied value from $110 million to roughly $127 million. CoinDesk reported ZRO gained over 23% in 24 hours following the proposal.
The acquisition would end Stargate's standalone governance and rewards system. Current STG staking programs would be eliminated in their current form. Post-merger, all Stargate bridge revenues would flow directly to LayerZero Foundation. ZRO holders would benefit from potential buybacks funded by these revenues. The proposal represents one of the largest cross-chain infrastructure consolidation moves in 2025.
Industry Implications For Cross Chain Infrastructure
This merger reflects broader consolidation trends in the cryptocurrency market. The Block reported crypto M&A activity rose to 248 deals in 2024, up from 221 in 2023. Venture capital firms anticipate more active crypto M&A in 2025 driven by regulatory clarity and renewed fintech interest.
Cross-chain bridges face intense competition as the DeFi market approaches $42.76 billion in 2025. Defiway noted rapidly increasing cross-chain interoperability as one of the main current trends. The merger questions the value of multi-token and sub-DAO models across the industry. Some community members view this as proof that multi-token setups have always been negative for projects.
Bridge consolidation comes as security remains a major concern. Cross-chain bridge hacks resulted in losses exceeding $2.8 billion in 2025, accounting for nearly 40% of all Web3 exploits. Larger, well-funded protocols may offer better security infrastructure than smaller independent bridges.
Further Reading
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