The LayerZero Foundation Proposes $110 Million Acquisition of Stargate
The LayerZero Foundation, which supports the cross-blockchain protocol LayerZero, has proposed buying Stargate for $110 million in tokens. The proposal appeared in a Stargate community forum post on Sunday. It stated that the plan aims to give Stargate resources to expand beyond cross-chain bridging.
The deal would swap Stargate Finance’s STG token for LayerZero’s ZRO token at a fixed rate of 1 STG for 0.08634 ZRO. At the time, STG traded at $0.2013 and ZRO at $2.50.
Stargate, created by LayerZero in 2022, allows digital asset transfers between blockchains using liquidity pools. These pools enable native transfers instead of using blockchain bridges, which have faced security breaches. If the community approves, the acquisition would return Stargate to direct control by LayerZero.
STG and ZRO Prices See Double-Digit Gains
Following the announcement, ZRO price rose over 23% in 24 hours to $2.44, according to CoinGecko data. Over the past week, ZRO price increased by almost 40%.
The STG price also climbed 16.5% in 24 hours, reaching just over $0.19. This extended its rally over the past week. However, both tokens remain far below past highs. The ZRO price is down 67% from its December 2024 peak of $7.47, while the STG price has fallen more than 95% from its mid-2022 high of $4.14.
LayerZero CEO Cites Goal for Faster Development
Bryan Pellegrino, co-founder and CEO of LayerZero, posted on X that he aims “to move faster, ship faster.” He said the plan would help Stargate follow its roadmap while creating “a single stack” for integrations in the LayerZero ecosystem.
Pellegrino added that the token swap would give STG holders “a more liquid token” and provide the Stargate community with “more resources and a single unified direction.”
Stargate Community Raises Concerns Over Token Swap
The Stargate community reaction to the proposal included concerns about the swap terms. Some users said the offer gave STG holders no benefit compared to holding the current token. They noted that the STG revenue-sharing model would not be available with ZRO, and staking rewards would end.
One user wrote,
“The offers are not attractive at all. They do not offer any advantages to STG holders, and STG’s revenue-sharing system is not available on ZRO. We will only be able to hold on to our tokens.”
The same user said LayerZero “needs to raise its offer significantly.”
Other users called the offer “fundamentally flawed” and suggested a 1:1 token swap based on Stargate revenue and protocol performance. Another community member agreed on merging tokens to simplify management but criticized the loss of staking rewards.
Stargate confirmed that the LayerZero acquisition plan will remain open for community comments for seven days. After that period, the platform’s decentralized autonomous organization (DAO), made up of tokenholders, will vote on whether to approve the deal.
ZRO Price Surges With Strong Momentum Indicators
The ZRO/USDT four-hour chart from TradingView shows a sharp breakout in price following the LayerZero $110 million Stargate acquisition proposal. The latest candle records a high of $2.599 before settling near $2.479, reflecting a strong upward move. This surge comes after a steady climb from early August, when the price was trading below $1.80.
The 50-period exponential moving average (EMA), positioned at $1.926, is trending upward, indicating bullish momentum. The price is now trading well above this level, suggesting sustained buying pressure. This distance between the price and EMA also highlights the strength of the recent rally.
The Relative Strength Index (RSI) has entered overbought territory, reading 81.58. This level shows strong market demand but also signals that the token may be overextended in the short term. The RSI’s rapid climb from near the midline of 50 to over 80 reflects intensified buying interest after the acquisition news.
Trading volume has spiked sharply, with 4.11 million ZRO traded in the current four-hour session. This is significantly higher than previous periods, confirming strong participation from market players. The large green volume bars coincide with the breakout, reinforcing the bullish sentiment.
Overall, the technical structure shows that ZRO price broke through previous resistance zones with high volume and momentum. The EMA alignment, strong RSI, and trading volume data all indicate that buying activity intensified immediately after the LayerZero announcement.
ZRO RSI Signals Strong Buying Pressure
The Relative Strength Index (RSI) for ZRO/USDT on the four-hour chart shows a sharp rise, currently reading 81.40, which is well above the overbought threshold of 70. The RSI’s rapid climb from near the neutral 50 zone to over 80 occurred within a short period, reflecting intensified buying pressure following the LayerZero–Stargate acquisition news.
The RSI moving average, marked in yellow, is at 66.59, and it lags behind the main RSI line, confirming the strength of the current upward momentum. This divergence between the RSI value and its moving average suggests that buyers have significantly outpaced sellers over the past sessions.
Overbought conditions, as shown here, indicate that the price has risen quickly relative to recent performance. While this signals strong bullish sentiment, it also shows that ZRO may be extended in the short term, making it more sensitive to potential pullbacks if buying activity slows.
ZRO MACD Shows Strong Bullish Momentum
The MACD (Moving Average Convergence Divergence) for ZRO/USDT on the four-hour chart signals a strong bullish phase. The MACD line, shown in blue, is at 0.129, positioned well above the signal line in orange, which stands at 0.075. This wide gap between the two lines reflects strong upward momentum in price action.
The histogram bars have expanded significantly into positive territory, currently at 0.054, indicating accelerating bullish momentum. This expansion aligns with the sharp rise in ZRO’s price following the LayerZero–Stargate acquisition news, showing that buying interest intensified sharply during this period.
The steep upward slope of the MACD line suggests that momentum has increased rapidly, driven by strong trading volume and aggressive buying. This combination of a positive histogram, a wide MACD-signal gap, and an upward slope confirms that short-term sentiment remains bullish, even though the asset is already in overbought territory according to the RSI readings.