LayerZero Proposes Acquisition and Merger of Stargate Token Economy
The LayerZero Foundation proposed acquiring Stargate (STG) and merging its token economy into LayerZero (ZRO). Key points include:
- Stargate Finance was developed by the same team behind LayerZero.
- All STG tokens would be converted to ZRO at a fixed rate, retiring STG as a standalone token.
- Stargate's bridge revenues, totaling $939,000 in the past three months, would benefit ZRO holders through potential buybacks.
- The merger aims to simplify the system, reduce overlap, and concentrate value in one asset.
- Staking for STG would end, with former holders participating directly in LayerZero's economy without dedicated staking yields.
- Community responses indicate valuation concerns, with some STG holders feeling undervalued by the proposed swap ratio.
- Call for improved terms or alternative incentives to compensate for lost staking income has emerged.
- The proposal could set a precedent for future governance and revenue redistributions in similar consolidations.
Both ZRO and STG tokens have increased over 20% in the last 24 hours, according to CoinGecko.