ZKsync Creator Announces Layoffs as It Pivots to Permissioned Privacy Chain

Leadership says the layoffs were driven by changing technical requirements rather than any cost-cutting pressure.

Matter Labs is reshuffling its team as the company moves to a permissioned privacy chain called Prividium.

The layoffs will include senior engineers, designers, and operators who are no longer aligned with the new direction.

Founder Explains Layoff Decision.

Alex Gluchowski, the company’s CEO, confirmed the news on social media, noting that the decision followed the company’s 2024 shift toward building products for regulated financial institutions.

“Today we reduced the size of the Matter Labs team. This was my decision, and I want to explain it,” he wrote.

According to him, Prividium has since become Matter Labs’ main focus, with the firm now fully committed to building tools that help businesses move on-chain.

The founder added that as the project developed, the company gained a clearer understanding of what customers needed, which heavily influenced the direction of Prividium and the type of talent required to move it forward. As a result, some roles that made sense during earlier stages of building were no longer the best fit for the firm’s current priorities. This, he said, is what prompted the restructuring decision.

The firm’s website states that Prividium is an Ethereum-based blockchain platform for financial institutions and fintech companies that gives organizations a way to do transactions securely while being compliant. Additionally, the product is built on a privacy-focused, permissioned Layer-2 blockchain powered by zero-knowledge technology.

“To everyone leaving, thank you for what you built here, and for the standard you set,” he concluded.

Alex said the move wasn’t a reflection on the employee’s abilities and contributions, adding that the engineers, designers, and operators impacted were some of the best he has worked with. The workers who left have also reportedly been offered financial help and support as they go through the transition.

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Community Remains Divided Over Job Cuts

The community’s reaction to the news has been mixed, with some excited about the project and others asking where the $450 million that Matter Labs raised to develop the product had gone.

“Could you please explain? You raised $450 million in investment to develop the product. Where’s the money? And why are you asking for more and laying people off?” they wrote.

Meanwhile, this isn’t the first time the firm has had to let go of its employees. The company also downsized its team in the midst of a pivot toward privacy-focused tools in 2024, with the firm saying that the restructuring was necessary to align its workforce with new priorities rather than a short-term cost-cutting measure.