LayerZero (ZRO) Surges 25% After Proposing $110M Stargate Acquisition

LayerZero’s native token, ZRO, posted significant gains today following a proposal by its foundation to acquire Stargate Finance in a deal valued at about $110 million. In an X post, LayerZero laid out the plan, highlighting that the offer is designed to accelerate both platforms.  

The LayerZero Foundation has proposed an acquisition of Stargate (STG).

Bring the Bridge Home. pic.twitter.com/OfB4eV2r96

— LayerZero (@LayerZero_Core) August 10, 2025

The proposal aims to give Stargate the resources to grow faster and do more than just bridging. Under this offer, Stargate’s native token STG will be swapped at a fixed swap rate.

For background, Stargate is a cross-chain messaging protocol launched in 2022 by LayerZero. The platform lets users move digital assets between blockchains through liquidity pools. These pools are promoted as enabling native transfers, avoiding traditional blockchain bridges that have a track record of security breaches.

LayerZero Foundation Proposes Stargate Acquisition 

According to the proposal, LayerZero would exchange Stargate Finance’s token (STG) for its own token (ZRO) at a rate of 1 STG for 0.08634 ZRO. It also plans to shut down the Stargate DAO and merge its revenues and operations into the LayerZero ecosystem.

Additionally, excess revenue from Stargate would be directed toward buybacks of LayerZero’s native token. This mechanism is intended to funnel bridge cash flow into reducing ZRO’s circulating supply over time. LayerZero co-founder and CEO Bryan Pellegrino said the proposal is designed to help both platforms move faster.

“This gives STG holders a more liquid token, the @StargateFinance community a clear path forward with significantly more resources and a single unified direction. This proposal is for the acquisition of Stargate, the merging of the two tokens into one (ZRO), and all future excess revenue driven to a ZRO buyback program”, he said. 

It is worth noting that this proposal is not automatic. It is still subject to Stargate DAO rules and a community vote, which will be on for seven days. After the discussion period, a Snapshot vote will be scheduled. 

The proposal needs at least 1.2 million veSTG in quorum and 70% approval to pass. If approved, the token swap will remain available through a redemption contract, so holders won’t face pressure to decide quickly.

Notably, this offer has received mixed reception, with some community members expressing enthusiasm, while others argue the swap undervalues Stargate. 

Market Reaction 

Following the proposal acquisition, both tokens posted significant gains reflecting speculative interest and merger-based optimism. According to data from Coingecko, ZRO trades at $2.44, representing a 26.3% surge in the last 24 hours. Its trading volume surged by 1,198.60% to approximately $442 million, signifying strong investor interest driven by the recent proposal. 

Similarly, STG jumped by 20% in the day, currently changing hands at $0.1966. With a market cap above $190 million, the token’s trading volume has surged 1,022.10% in the past day to around $77 million.

Despite the impressive price increase, some community members have expressed certain reservations. Several stakeholders have already voiced concerns about the deal’s valuation and how existing token holders will be affected. 

Additionally, critics worry the deal would dissolve the Stargate DAO and concentrate governance under the LayerZero Foundation. They argue this could undermine decentralization and remove the community’s control over a bridge that generates real revenue.

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