LayerZero’s acquisition of Stargate has officially received community approval, marking a pivotal chapter in the world of decentralized finance (DeFi). Over the weekend, Stargate’s decentralized autonomous organization (DAO) voted by an overwhelming margin nearly 95% in favour of accepting LayerZero’s revised $110 million offer, putting an end to what became an intense, multi-party bidding war.

Image Source: LayerZero

Community Voices Shape the Deal

Stargate’s passionate community played a central role, voicing concerns when LayerZero’s initial proposal failed to meet their expectations. Some felt the deal undervalued Stargate and did not account for the significant ongoing revenue generated by its cross-chain bridging technology. As rival protocols, including Wormhole, Axelar, and Across, quickly swooped in with competing offers, it sparked one of the highest-turnout votes in Stargate’s governance history. Over 15,000 wallet addresses participated, representing more than 7 million STG tokens staked in the final tally.

Rival Bidding War

Wormhole made a splash with a $120 million all-cash bid, promising Stargate token holders triple the projected revenue for the next six months paid up front. Axelar and Across signaled strong interest too, contingent on a more competitive and transparent process. Despite these generous overtures, Stargate’s DAO opted for LayerZero’s revised proposal, which promised long-term value and strategic ecosystem alignment over a quick cash grab.

What the Approved Deal Means

Under the newly approved terms, Stargate stakers will receive 50% of protocol revenue for the coming six months, with the remaining half allocated toward LayerZero’s ZRO token buybacks. All circulating STG tokens will swap to ZRO at a fixed ratio (1 STG = 0.08634 ZRO), beginning August 25. This merger is poised to dissolve Stargate’s DAO, unifying governance and infrastructure under LayerZero’s umbrella.

For token holders, the transition is more than just a swap. Many have expressed hope that the partnership will unlock new opportunities by combining Stargate’s liquidity pools and native cross-chain bridges with LayerZero’s robust messaging protocol and market reach. Stargate, already powering over $70 billion in transactions and bridging 50+ blockchains, now stands to benefit from LayerZero’s 85% market share in blockchain interoperability.

Perspectives and Outlook

LayerZero CEO Bryan Pellegrino lauded the move, emphasizing that Stargate’s return paves a clear path to serve the end consumer, accelerate value transfer, and generate meaningful revenue. For many in the DeFi ecosystem, the acquisition marks one of the largest DAO buyouts in crypto history and a decisive reinforcement of LayerZero’s leadership in blockchain interoperability.

Amid the optimism, some trepidation lingers. Token prices for ZRO and STG have wobbled in response to market volatility, but many hope that bringing the protocols together will spur growth and innovation. With Stargate’s much-admired technology and LayerZero’s expansive reach, the merged entity aims to push cross-chain transfers and composability to new heights.