Matter Labs has laid off 24 employees, over 16% of its workforce, amid market changes. The company is shifting focus from general-purpose scaling to niche applications. Despite layoffs, Matter Labs continues hiring for critical engineering and business roles.

Matter Labs, the company behind the Ethereum scaling network ZKsync, has announced the layoff of over 16% of its workforce, affecting 24 employees. The announcement, made on September 3, 2024, by Matter Labs’ co-founder and CEO Alex Gluchowski, marks a significant shift for the company as it navigates the increasingly competitive landscape of Ethereum layer-2 scaling solutions. Matter Labs restructuring amid market challenges The layoffs come as Matter Labs re-evaluates its strategy in the face of changing market conditions and evolving business needs. It follows a large organizational planning exercise that revealed a mismatch between the company’s current talent and the needs of its future strategy. According to Gluchowski, the decision to downsize was “the hardest change” he’s had to implement in the company’s six-year history. In the layoff announcement, Gluchowski explained that the affected employees were notified of their termination and emphasized that the decision was not performance-related. He highlighted the necessity of aligning the company’s resources with its new strategic goals. Despite the layoffs, Matter Labs is currently hiring for key roles in engineering, business development, and operations, underscoring its ongoing commitment to innovation and growth despite the reduction in staff. Shifting focus from general-purpose to niche solutions The layoffs are part of a broader strategic pivot for Matter Labs. In June 2024, the company introduced the Elastic Chain, a new solution aimed at enhancing interoperability for the growing number of teams building custom chains on ZKsync. This launch has prompted Matter Labs to reconsider its positioning in the highly competitive Ethereum layer-2 ecosystem, which includes other major players like Coinbase’s Base, Polygon, Arbitrum, and Optimism. Gluchowski indicated that Matter Labs might be moving away from its initial focus as a general-purpose Ethereum scaler. Instead, the company is exploring more niche and case-specific applications of its technology, a move designed to better meet the needs of its users and stay competitive in the crowded market. As Matter Labs adjusts its course, the company’s commitment to innovation remains strong. The layoffs, while difficult, are a step towards aligning its workforce and resources with its evolving strategy in the Ethereum scaling space.

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Avalanche9000 upgrade will enhance subnet deployment on Avalanche, making L1 launches more feasible. The upgrade will also Introduce customizable chains, speeding up project development and market entry. The announcement has had no impact on the price of AVAX, which is down 2.22% amid a broader market decline.

Avalanche, a leading high-performance blockchain platform, has unveiled its most significant network upgrade since its mainnet debut in September 2020. The upgrade, named Avalanche9000, marks a pivotal moment in the evolution of the Avalanche ecosystem as it aims to further solidify its position within the crypto landscape. Avalanche has gained recognition for its highly scalable and flexible blockchain architecture, which enables developers to build and deploy decentralized applications (dApps) on a fast, secure, and low-cost network. As the platform continues to grow, the introduction of Avalanche9000 is poised to elevate its capabilities, driving greater adoption and innovation across the ecosystem according to a blog post by Avalanche. Enhancing Avalnche’s scalability and flexibility One of the key goals of Avalanche9000 is to accelerate the deployment of subnets, specialized Layer 1 chains (L1s) that operate within the Avalanche network. These subnets allow developers to create custom chains with specific rules on membership, tokenomics, and execution layers, offering a tailored and optimized experience for different use cases. With Avalanche9000, the deployment of these subnets will become more economically feasible, enabling a broader range of developers and enterprises to launch their own L1s. The upgrade will also introduce customizable chains, reducing the time it takes for projects to go from concept to market. By streamlining the development process, Avalanche9000 is set to empower innovators and entrepreneurs with the tools they need to quickly and efficiently build on the Avalanche platform. Expanding the Avalanche ecosystem In addition to technical enhancements, Avalanche9000 will be accompanied by the release of tools and documentation designed to assist users in launching their own L1s. The upgrade is also expected to include a variety of network changes based on community proposals, along with developer incentives and partnerships with key industry players. Several major L1 launches are already lined up, including those by Deloitte, DeFi Kingdoms, Gunzilla Games, MapleStory, Shrapnel, and SK Planet. These projects highlight the growing interest in Avalanche as a platform for both enterprise and gaming applications, further establishing its reputation as a versatile and robust blockchain solution. As the Avalanche9000 testnet is set to launch soon, the blockchain community eagerly anticipates the impact of this upgrade on the broader ecosystem. With its focus on scalability, flexibility, and ease of use, Avalanche9000 represents a significant step forward in the ongoing evolution of the Avalanche network.

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