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Matter Labs Restructures Amidst Shifting Developer Demands, Lays Off 16% of Workforce

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The developer behind ZKsync adapts to evolving market needs, trimming its team by over 30 employees.


Matter Labs Restructures Amidst Shifting Developer Demands, Lays Off 16% of Workforce

Matter Labs, the primary developer of the Ethereum layer-2 protocol ZKsync, has announced a significant restructuring effort, resulting in the layoff of 16% of its workforce. This move, according to CEO Alex Gluchowski, is a strategic response to the evolving demands of developers using the ZKsync platform, which now require different types of technology and support.


In a post on X, Gluchowski explained the decision, stating, "We went through a large org planning exercise, and it became clear that the talent and roles we have today do not perfectly match our needs." Matter Labs, which reportedly employs around 200 people according to its LinkedIn profile, could be letting go of more than 30 team members as part of this restructuring.


ZKsync operates in a highly competitive space, vying for market share among Ethereum layer-2 networks. These protocols are designed to improve the Ethereum blockchain's efficiency by settling transactions faster and at a lower cost. However, with the proliferation of layer-2 solutions, the industry may be reaching a point where a more specialized approach is necessary.


In a recent interview with Blockonome, Gluchowski suggested that the landscape of layer 2s needs to be re-evaluated with a focus on specific use cases. He pointed out that not all layer-2 solutions need to serve a general-purpose function. For instance, Matter Labs introduced the Elastic Chain in June to address the fragmentation among layer 2s by enabling different networks to connect through an interoperability layer.


"We have projects launching on the Elastic Chain that are just gaming chains, which do not really need to be sharing infrastructure block space with DeFi or financial applications," Gluchowski said. This perspective reflects a growing trend towards more application-specific or community-specific layer-2 networks.


The restructuring at Matter Labs underscores the challenges and dynamic nature of the blockchain and crypto industry, where rapid innovation often necessitates quick organizational shifts. The ZKsync token (ZK) has reflected some of this turbulence, dropping 3.14% in the past 24 hours, according to CoinGecko.


As Matter Labs continues to adapt to the changing market, it remains to be seen how these strategic moves will position ZKsync in the broader Ethereum layer-2 ecosystem.


photo source / Blockonome

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