A significant tussle has emerged in the decentralized finance (DeFi) space as the Wormhole Foundation publicly challenged LayerZero’s $110 million bid to acquire Stargate Finance. This move ignites a debate over the true valuation of cross-chain bridge protocols and the future direction of a key player in interoperability.
The Heart of the Valuation Debate
The Wormhole Foundation contends that LayerZero’s offer of $0.1675 per STG token dramatically undervalues Stargate Finance, a prominent cross-chain bridge protocol. Wormhole points to Stargate’s robust financial health and impressive growth as evidence, highlighting over $92 million in treasury assets, including substantial stablecoin holdings. Furthermore, Stargate’s operational performance reinforces this argument, having processed a remarkable $4 billion in bridge volume in July 2025—a tenfold year-over-year increase—and boasting $348 million in Total Value Locked (TVL) across more than 80 chains. Wormhole asserts that Stargate’s fundamental strengths, encompassing its assets, brand, codebase, and team, warrant a considerably higher valuation than LayerZero's proposed terms.
Competing Strategic Narratives
LayerZero, in defending its acquisition proposal, views the move as strategic ecosystem consolidation, emphasizing Stargate's established infrastructure and user base. Their plan includes directing future Stargate excess revenue towards ZRO token buybacks and expanding the protocol’s mandate beyond traditional bridging. LayerZero also argues that unified governance would eliminate potential resource conflicts between competitive protocols. Conversely, the Wormhole Foundation offers an alternative strategic path. They envision combining Stargate’s unified liquidity pools with Wormhole’s expansive ecosystem of integrations to foster higher volumes, increased revenues, and greater "stickiness" for both STG and W token holders. To facilitate a fair assessment, Wormhole has requested a temporary suspension of the ongoing governance vote on LayerZero’s proposal, allowing time for due diligence and the preparation of a potentially competing bid. The fate of LayerZero's offer now rests with STG token holders, requiring a 70% approval threshold.
