LayerZero Foundation has successfully acquired Stargate Finance in a deal valued at $110 million, culminating in what some have described as a four-way bidding war. The Stargate DAO approved the acquisition with a 95% majority, paving the way for the integration of Stargate's cross-chain capabilities into the LayerZero ecosystem. This acquisition signifies a major consolidation in the decentralized finance (DeFi) space, with LayerZero aiming to unify cross-chain operations under its ZRO token.

The acquisition process involved a token swap, where Stargate's STG tokens will be exchanged for LayerZero's ZRO tokens at a fixed rate of 1 STG to 0.08634 ZRO. This exchange has been a point of contention, with some critics arguing that the swap ratio undervalues STG tokens. Despite these concerns, the DAO's approval indicates a strong belief in the long-term benefits of the merger.

Notably, Wormhole Foundation presented a competing bid of $120 million in cash for Stargate, surpassing LayerZero's initial offer. Axelar and Across also reportedly considered bids. Wormhole argued that LayerZero's offer undervalued Stargate's potential, emphasizing Stargate's revenue and treasury assets. However, Stargate DAO ultimately favored LayerZero's offer, which prioritized long-term integration and alignment within the LayerZero ecosystem.

Bryan Pellegrino, Co-founder and CEO of LayerZero Foundation, highlighted the DAO's support as a "strong commitment to long-term integration of their cross-chain capabilities". The acquisition reflects a growing trend in DeFi towards protocol consolidation and integrated approaches.

Under the terms of the acquisition, Stargate's projected annual revenue of $1.4 million will be allocated to fund ZRO token buybacks, aiming to reduce the circulating supply and potentially increase its value. The Stargate DAO will be dissolved, centralizing governance under LayerZero. While proponents argue this will streamline decision-making, critics express concerns about the loss of decentralized governance.

The announcement of the acquisition triggered market activity, with both ZRO and STG tokens experiencing price surges. However, the long-term impact on STG holders remains a topic of discussion, particularly concerning the token swap ratio. As of August 24, 2025, STG was trading at $0.18, with a 0.74% decline over the previous 24 hours.

The acquisition signifies a strategic move towards integrated approaches in DeFi, highlighting the importance of technological foresight in future developments. The finalization of this deal marks a significant milestone in the cross-chain infrastructure space and has the potential to reshape cross-chain asset management.