LayerZero Proposes Acquisition of Stargate to Power Bold Expansion Plans
The crypto protocol Stargate is being offered for $110 million by the LayerZero Foundation, which backs the cross-blockchain messaging system LayerZero. The tokens linked to both projects have increased in value as a result of this news. In a post on Stargate’s forum on Sunday, LayerZero outlined the strategy. In order to give Stargate the resources to launch on an ambitious roadmap that extends its authority beyond bridging, it is presenting the offer as one that will expedite both LayerZero and Stargate.
The proposal would help Stargate execute on its ambitious roadmap while creating a single stack that anybody integrating within the LayerZero ecosystem can adopt.
LayerZero co-founder and CEO Bryan Pellegrino
STG Holders Brace for Token Swap in LayerZero’s Stargate Acquisition
LayerZero created and introduced Stargate in 2022, and if the agreement is accepted by the Stargate community, the platform will once again be under its control. Additionally, LayerZero stated that it would exchange Stargate Finance, the platform’s token, for its own token, LayerZero, at a rate of 1 STG to 0.08634 ZRO.
Through the use of liquidity pools, Stargate allows users to move digital assets between blockchains. The platform advocates for this approach since it lets assets transfer natively instead of depending on blockchain bridges, which have been compromised in the past.
“Not Attractive at All”: Stargate Investors Push Back Against LayerZero Proposal
However, the offer received largely unfavorable criticism from Stargate token holders, who stated that while they appreciate the necessity for a swap, the proposed arrangement is unfair and does not permit staking.
The offers are not attractive at all. They do not offer any advantages to STG holders, and STG’s revenue-sharing system is not available on ZRO. We will only be able to hold on to our tokens,
one Stargate user
The commenter also mentioned that LayerZero should make a substantial increase in their offer. Considering the amount of money Stargate makes and the potential of the protocol, several said the offer was essentially defective and that it should be greater, perhaps a 1:1 token swap.
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