Stargate

Bridging

Stargate is a fully composable cross-chain bridge protocol built on LayerZero that enables native asset transfers across blockchains.

Risk Rating
Watch Out
Protocol Code Quality
Protocol Maturity
Protocol Design
Summary
What we like
Stargate is building the first fully composable native asset bridge built upon LayerZero technology.
What we like less
The platform has a limited selection of assets that are currently available for cross-chain transfers.
What it means for you
Enables you to easily make cheap cross-chain liquidity transfers while providing a seamless user experience.

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Information
Exploit/Hacks
None
Info
  • Website
  • Token: STG
  • Tags: Bridging
Key Metrics
  • TVL: $188.1M (Rank #55)
  • TVL Ranking by Bridging: #0
  • Blockchain: Linea, Ethereum, Optimism, Binance, Arbitrum, Mantle, Polygon, Avalanche, Base, Fantom, Kava, Metis, Goerli
  • Chain TVL
    • Linea: $40.64M
    • Ethereum: $28.35M
    • Optimism: $26.52M
    • Binance: $22.36M
    • Arbitrum: $20.87M
    • Others: $49.33M
Risk Assessment
Watch Out
Protocol Code Quality
  • Code reviewed by at least one experienced auditor; Quantstamp audited in March 2022
  • Public team promotes accountability
  • No documented protocol hacks since launch
Protocol Maturity
  • Core protocol launched in 2022; maturity over one year minimizes technical risk as smart contracts are well battle-tested
  • Top 5% by total value locked reduces risk
  • Multisig wallet controls protocol upgrades
  • Multisig consists of less than 4 signers, which makes the protocol more susceptible to centralization risks
  • No timelock exists or no information documented, which mean a malicious actor could approve upgrades without any delay
  • Low voting power concentration reduces risk
Protocol Design
  • No death spiral concerns
  • Robust controls to mitigate oracle price manipulation
  • Locally verified bridge that uses liquidity networks on each chain to enable cross-chain swaps; this system typically uses a lock/unlock mechanism to ensure the safety of user funds
  • Bridge messages are validated by an external third-party that usually comprises a limited multisig
Things to know about Stargate

How Stargate works

Stargate was built on LayerZero technology, an omnichain interoperability protocol, to simplify the process of sending assets from one chain to another. Stargate achieves this through unified liquidity pools, access to native assets, and instant guaranteed finality.

Bridging protocols generally must ensure there is enough liquidity available on the destination chain to facilitate any transfers. Without instant guaranteed finality, transactions could be reverted which results in a poor user experience. A common workaround for this is the lock-and-mint (or burn-and-redeem) mechanisms. Rather than assume the destination chain has sufficient liquidity, the bridge will lock the native asset and mint a wrapped asset, thus guaranteeing sufficient liquidity. This approach, however, requires the user to manually swap the wrapped token on the destination chain to complete the bridge transfer.

Stargate eliminates the use of wrapped tokens and is able to swap native assets 1:1 across various chains due to it accessing unified liquidity pools. Most existing bridges operate through fractured liquidity, which means that each chain is assigned exclusive access to a designated liquidity pool for their users to deposit and withdraw from in order to bridge assets. As such, each chain maintains a separate liquidity pool with different chains having disparate levels of liquidity. Stargate resolves this with its unified liquidity design where all connections deposit and withdraw from a single pool. Due to this design, users no longer need to worry about transactions failing due to a lack of liquidity or issues with a wrapped token. Stargate also implements rebalancing fees to incentivize users to perform swaps that help refill low native asset balances and dissuade users from performing transfers that could deplete reserves on any given chain.

How Stargate makes money

Stargate charges several transaction fees. Each non-STG transfer through Stargate incurs a 6bps fee, with 4bps going to the protocol treasury, 1bp to STG stakers (veSTG), and 1bp to liquidity providers (LPs).

How you make money on Stargate

You can earn money by providing liquidity to earn a portion of transfer fees for a particular asset on a given chain. Anytime that asset is used to transfer between the source chain and destination chain, you earn a fee. STG stakers (veSTG) also earn a portion of protocol fees by staking on the platform.

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Stargate Pools
Stargate USD Bridging
9.2%
Yield
$3M
TVL
Risk
D
Protocol
Stargate
Chain
Polygon
Stargate USD Bridging
8.2%
Yield
$3M
TVL
Risk
D
Protocol
Stargate
Chain
Avalanche

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