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Polygon Labs Announces Restructuring Plan, Lays Off 19% of Workforce

Polygon Labs, a leading developer of Ethereum scaling solutions, announced on Thursday that it has laid off 60 employees, or about 19% of its workforce, as part of a restructuring plan to improve its performance and efficiency.

The company, which is behind the popular layer-2 rollup network Polygon, said that the decision was not driven by financial reasons, but by the need to return to the qualities that enabled it to execute ambitiously and nimbly in the past.

Marc Boiron, the CEO of Polygon Labs, explained in a post on X, a social media platform for web3 enthusiasts, that the company’s rapid growth in the last bull market had diluted its ability to collaborate closely and expedite demanding projects.

“We are on a mission to fundamentally change the Internet so that everyone in the world is empowered to equitably access its value. Building the infrastructure to make that happen is no easy feat,” Boiron wrote. “Regrettably, the team’s rapid growth in the last bull market diluted qualities that enable us to execute in this manner. We must return to those qualities.”

Boiron thanked the impacted employees for their contributions and said that the company would share more information for those who want to explore ways to stay in the web3 ecosystem. He also said that the company was implementing a 15% increase in everyone’s total compensation and eliminating traditional geo-pay models, in order to recognize individual value regardless of location and attract top talent globally.

“Right-sizing for the sake of enhanced performance, rather than for financial reasons, may seem unconventional. The reality is that achieving our mission often demands challenging decisions, and while difficult, the Founders and I agree that we must move forward in a thoughtful way that gives us the greatest chance to execute successfully,” Boiron concluded.

The announcement comes less than a year after Polygon Labs cut 20% of its staff, or around 100 jobs, amid a consolidation of multiple business units. The company said at the time that its treasury remained healthy, with a balance of more than $250 million and more than 1.9 billion MATIC, the native token of Polygon.

Polygon, formerly known as Matic Network, is one of the most widely used scaling solutions for Ethereum, which aims to provide faster and cheaper transactions for decentralized applications. Polygon claims to have more than 3,000 applications, 500 validators, and 200 million transactions on its network.

Polygon is also developing a zero-knowledge EVM (zkEVM) public testnet, which is expected to go live on March 27. The zkEVM is a layer-2 solution that leverages zero-knowledge proofs, a cryptographic technique that allows users to verify information without revealing it, to achieve high scalability and privacy for Ethereum transactions.

Polygon Labs’ layoff announcement comes at a time when the crypto industry is facing a downturn, following the collapse of FTX, a major crypto exchange that was accused of fraud and market manipulation. The FTX debacle triggered a wave of regulatory scrutiny and investor panic, leading to a sharp decline in the prices of many cryptocurrencies, including Ethereum and MATIC.

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