While LayerZero Foundation has proposed a $110 million acquisition of Stargate, valuing the protocol’s STG tokens at approximately $0.1675 each and seeking to centralize control by dissolving Stargate’s DAO, the Wormhole Foundation has formally challenged this bid, disputing the valuation on the grounds that Stargate’s substantial assets—including a reported $345 million total value locked (TVL), a treasury comprising stablecoins, Ethereum, and native tokens, and a rapidly expanding bridge volume that reached $4 billion in July 2025—justify a considerably higher market worth; Wormhole’s strategic intervention, which includes requesting a pause in the Snapshot voting process, signals intensified competition within the decentralized finance (DeFi) sector over cross-chain infrastructure projects and underscores the ongoing debate about the appropriate valuation and future governance of one of the blockchain ecosystem’s most integrated bridging platforms. LayerZero’s proposal also includes a fixed conversion rate allowing STG holders to exchange tokens for ZRO, LayerZero’s native token, at a rate of 1 STG to 0.08634 ZRO, aiming to consolidate control under the Foundation’s tokenomics token conversion.
LayerZero’s $110M bid for Stargate faces Wormhole’s challenge over valuation and governance control.
LayerZero’s proposal offers to exchange STG tokens for its own ZRO tokens at a rate valuing STG near its current trading price, though notably below its 2022 peak of $4.14. The acquisition aims to leverage Stargate’s extensive user base, brand recognition, and a historical transfer volume exceeding $70 billion. Central to this bid is the dissolution of Stargate’s decentralized autonomous organization (DAO), effectively consolidating governance under LayerZero Foundation. The proposal requires a quorum of 1.2 million vote-escrowed STG tokens and a 70% approval threshold in the Snapshot vote, conditions that highlight the importance of community sentiment in determining Stargate’s future. Stargate’s estimated annual revenue of approximately $2 million further supports the argument for a higher valuation.
Wormhole challenges the bid by emphasizing Stargate’s considerable on-chain metrics: a treasury holding approximately $76 million in stablecoins, $15.9 million in Ethereum, and $55 million in Stargate tokens, alongside other assets valuing roughly $5.24 million. The bridge’s $4 billion monthly volume evidences rapid growth, and with integrations across more than 80 blockchains, Stargate commands a significant strategic position. Wormhole’s request to suspend Snapshot voting for five days reflects a tactical effort to prepare a competitive counteroffer, underscoring the foundation’s intent to capture a pivotal role in the cross-chain liquidity domain.
The unfolding contest between LayerZero and Wormhole highlights broader market tensions, as stakeholders weigh Stargate’s valuation and governance trajectory amid evolving DeFi infrastructure consolidation. Token price reactions, while showing moderate gains, remain subdued relative to historical highs, indicating investor caution. Ultimately, the outcome will influence governance models and capital allocation strategies across interoperable blockchain networks, as competing entities vie for dominance in a sector pivotal to decentralized finance’s next phase.
