tl;dr
The Stargate DAO governance approved LayerZero’s acquisition with 94.76% support, ending Stargate DAO and exchanging STG tokens for LayerZero’s ZRO at a rate of 1 STG to 0.08634 ZRO. Initial opposition arose due to concerns over yield loss and competing bids from Wormhole, Axelar Foundation, and Acr...
The governance organization managing the Stargate cross-chain bridge has approved LayerZero’s acquisition offer, concluding a decisive vote with 94.76% (7.2 million) supporting and 5.24% (399.4K) opposing the deal. This acquisition marks the end of Stargate DAO, with STG holders exchanging their tokens for LayerZero’s native token ZRO at a rate of 1 STG to 0.08634 ZRO.
LayerZero highlighted its strategic position at the crossroads of asset tokenization and blockchain expansion, stating that acquiring Stargate places them to power the next phase of blockchain adoption, which they term the "Cryptoization of Finance."
The approval process faced resistance as STG holders initially criticized the offer due to the potential loss of yield returns. Many holders had locked STG tokens to obtain veSTG, which grants access to fee revenues generated by Stargate. Additionally, LayerZero’s competitor, Wormhole, presented a rival bid, encouraging the community to delay the vote and consider alternatives. The Axelar Foundation and Hart Lambur of Across also confirmed intentions to submit formal bids if the voting was temporarily paused, a sign of rising competition within the blockchain interoperability space.
In response, LayerZero modified its offer by committing to allocate 50% of Stargate’s revenue to veSTG holders for six months post-voting, instead of suspending their income. The other half of the revenue, along with any surplus profits, will support ZRO’s buy-and-burn program to strengthen LayerZero’s ecosystem over time. Despite challenges, the vote concluded with majority approval late Saturday.
LayerZero’s team celebrated, promising to expand Stargate beyond bridging and token expansion into a comprehensive financial platform featuring swaps, vaults, and more. Stargate has previously served as a central liquidity hub across blockchains and hosted millions of users.
For STG investors, the DAO’s dissolution means migrating holdings into LayerZero’s ecosystem, swapping STG for ZRO tokens. veSTG holders will continue to receive a share of revenues for six months before distributions end, after which profits will support the ZRO token through burning and buyback mechanisms.
On the market front, the STG token saw a modest 1% increase to $0.1795, while ZRO rose 0.8% to $2.08 amid heightened trading activity. These price movements suggest participants are reacting to the acquisition news and searching for volatility-driven opportunities.