The bridge wars are heating up.
And Stargate is leading the pack.
Here’s your June 2023 deep dive on LayerZero's hottest project.
Let’s dive in…
$STG
Price = $0.54
Omnichain bridge
Market cap = $110m – Rank 220
All time high = $4.14 (-87%)
All time low= $0.338 (60%)
We live in a multichain world, and while this is good for competition between blockchains, it is not so good for liquidity and users. The traditional method of bridging between chains has several downsides
Costly fees
Bridging risk (exploits)
Takes a long time
The by-product of this is that liquidity is fragmented between bridges and their individual pools. So how do we fix this?
By using LayerZero tech, Stargate unifies liquidity across all chains. An asset transferred from Chain A is guaranteed to receive the asset on Chain B. The LP providers receive fees from all incoming transactions to Chain B, regardless of the source chain.
h/t to the team @ReveloIntel for providing the some of the info I have used in this report. You have to check out their new product ‘Analyst insights’.
https://twitter.com/ReveloIntel/status/1668630226698670080
Stargate is an omnichain protocol built on top of LayerZero that allows users and dApps to transfer native assets cross-chain while accessing the protocol’s unified liquidity pools with instant guaranteed finality.
What separates it from competitors?
Instant guaranteed finality
Unified liquidity
Transactions on native assets
Revenue
Over the last 30 days, Stargate has generated $1.47m in revenue- up 37%. A strong uptrend starting in March this year.
Daily revenue is around $47k- the leading cross chain bridge.
8.5 for Revenue.
Treasury
Stargate has a significant Treasury with the following holdings:
TOTAL $264.8m USD
79% own token ($STG)
20% stablecoins
1% others
It is also fairly well diversified with over $50m in stablecoins giving the team a good runway.
9 for Treasury.
Tokenomics
The initial token distribution for the project was:
30% - Community
18% - Team
18% - Investors
16% - Bonding Curve
15% - Protocol Launch
2% - Initial Emissions
2% - DEXs
$STG is the native utility and governance token of the protocol. It can be used for:
Providing liquidity,
Participating in protocol governance
Staking to receive $veSTG
Like the original ve model, Stargate uses a time-weighted reward system that incentivizes long-term staking. It does this by increasing the amount of $veSTG tokens that stakers receive the longer they keep their tokens locked.
Each non-$STG transfer that goes through Stargate incurs a 6 bps fee:
4 bps to the treasury
1 bp to veSTG holders
1 bp to liquidity providers
This is good value accrual for STG stakers (voted for in governance proposal- June 2022).
8.5 for Tokenomics.
Locked up funds
These are the current supply stats:
Circulating supply = 204m
Max supply = 1b
Market cap = $113m
FDV = $553m
Market cap/ FDV = 0.2
65% of the total supply of tokens has been unlocked. All tokens are due to be vested by March 2025.
As you can see from the bubblemaps, the token distribution is fairly well decentralised after the Alameda centralisation issue was resolved.
8 for Locked up funds.
Use case
Total TVL is sitting at $400m– 1st amongst other cross chain bridges.
I suspect that Stargate has benefited from the hype around a LayerZero airdrop, boosting their transactions and TVL.
Aside from that, the protocol has a unique use case and first mover advantage in the omnichain bridge market.
As DeFi grows, it will become more and more important for seamless and efficient cross chain bridging.
9 for Use case.
Roadmap
The latest roadmap release was from April 2023 by Commonwealth labs. It breaks it up into cycles 3, 4 and 5. It is not an official roadmap, however here are some key focus areas for the team:
More chains
Products
Asset integrations
7.5 for Roadmap
Team & funding
Stargate is a project founded by the LayerZero Labs team and launched on 17th March 2022. It is a DAO-owned operation.
Some prominent members of the team include:
Bryan Pellegrino, CEO and Co-Founder
Ryan Zarick, Co-Founder and CTO
Stargate was funded by 2 community raises. There was also a token allocation to team and investors, with some from the LayerZero Lab raises.
Community Round 1
Raised $25M (17 Mar 22) - avg. price of $0.25
2 participants- Alameda Research getting almost the entire allocation
Community Round 2
Raised $5M on 30 Mar 22 with an average price of $0.25.
8 for Team & Funding.
Summary
TLDR summary for each category’s score out of 10.
8.5 - Revenue – $1.47m revenue over 30 days
9 - Treasury– $265m in Treasury
8.5 - Tokenomics – Value accrual for STG stakers
8 - Locked up funds – 65% tokens in circulation
9 - Use case – $400m TVL, 1st among other cross-chain bridges
7.5 - Road map – Released in April 2023, not official
8 – Team & funding – Doxxed team, 2 x community raises
TOTAL- 8.5 weighted avg. score
https://docs.google.com/spreadsheets/d/1mPGbrsSEqBCN4lTVIIfdu3UzhZVqGP6LWMXlJrWJ5RE/edit#gid=0
Stargate was one of the most hyped projects of 2022. Recent price action isn't great, however, stats such as transfer volume, fees, revenue, TVL, treasury value, or even DAU continue to trend up. Early in the bridge wars, Stargate is emerging as the clear winner.
The purpose of this thread is for education and research- not financial advice. I am NOT a paid advisor or ambassador of Stargate- just interested in the project.
Always DYOR before Apeing in. Here is a framework I prepared earlier.
https://twitter.com/jake_pahor/status/1603039685609152515
CC other Stargate enjoyers.
@StargateFinance
@0xFastLife
@ReveloIntel
@Slappjakke
@Flowslikeosmo
@0xsurferboy
@splinter0n
@apes_prologue
@NestedFi
@DreadBong0
@OuroborosCap8
@rektfencer
@milesdeutscher
@crypto_linn