On the night of January 25th, East 8 Time, in response to rumors circulating on social media about the "team disbanding and the project exiting," Polygon Labs issued an official post addressing these concerns and simultaneously announced the latest round of organizational restructuring and layoffs. The choices surrounding core routes such as zkEVM and AggLayer were also partially clarified in this response.
Key Information on Layoffs and Restructuring
● News Driven:
- Polygon Labs confirmed in an official statement that it has completed a new round of personnel reductions, affecting approximately 19% of its workforce, or about 60 people. This marks the second significant optimization following a 20% layoff at the beginning of 2023.
- Management characterized this adjustment as "organizational restructuring," emphasizing that it is unrelated to a financial crisis but rather aimed at "clearly aligning core routes and priorities."
● Direct Response to "Exit" Rumors:
- Polygon Labs clearly stated that the team will not "disband" or "withdraw from the Ethereum ecosystem," and there are no plans for a so-called "project shell sale" or "selling off core assets and running away."
- Regarding the circulating claim that "senior team members will liquidate MATIC and exit," Polygon did not provide itemized clarifications but emphasized: the funding runway is sufficient, and the ecological treasury remains within long-term operational planning.
● Official Explanation of Layoff Motives:
- Polygon Labs attributed the main reasons for this personnel optimization to:
- Too many product lines and organizational bloat, with multiple overlapping R&D routes internally;
- A desire to concentrate more resources on the AggLayer cross-chain aggregation layer and zkEVM technology stack;
- Avoiding "spreading too thin" across multiple sidechains / Supernets / enterprise chains, leading to disproportionate long-term input-output.
Strategic Focus on zkEVM and AggLayer
● Core Statement on zkEVM R&D Path:
- Polygon reiterated that zkEVM remains one of the long-term technical bets and will not be "discontinued" or "abandoned," but will adjust its external narrative and resource weighting.
- The official description of zkEVM is as "a foundational component of the Polygon technology stack," rather than a single product line, indicating that zk proof systems will be embedded in multiple networks and solutions.
● Increased Priority for AggLayer:
- In the latest roadmap, Polygon emphasized the strategic position of AggLayer multiple times:
- The goal is to provide a unified liquidity and shared state aggregation layer for multiple L2 / L3s;
- It aims to play the role of "settlement and aggregation hub" in a "multi-rollup world";
- The official statement indicated that AggLayer will prioritize carrying new ecological resources and BD capabilities.
● Resource Reallocation Across Multiple Product Lines:
- The official language mentioned "shrinking from edge routes to focus on the core stack," which mainly includes:
- A direct reduction in investment in certain application chain / Supernet projects, focusing more on technical support and partnerships;
- Vertical integration of the zk R&D team with the AggLayer team to reduce redundant construction;
- Gradually downplaying the promotion of "single-chain TPS metrics," instead emphasizing "multi-chain interoperability and liquidity aggregation."
Key Signals on Funding and Operational Status
● Indirect Disclosure of Cash and Treasury Status:
- Polygon Labs emphasized that after this round of layoffs, it will provide "three months of salary compensation" and "transferable equity optimization" to the laid-off employees, and promised to assist them in connecting with other Web3 companies, reflecting that there is no immediate risk of cash flow disruption.
- The official also mentioned that the Polygon Foundation still holds assets "capable of supporting years of R&D and ecological incentives," but did not provide specific numbers or asset composition, and the Research Brief did not disclose more details.
● Response to Market Concerns Over "Asset Liquidation":
- In response to community concerns about whether the foundation would concentrate on liquidating MATIC and exerting pressure on the market, Polygon's official response was simply that "it will continue to manage the treasury with a goal of long-term sustainability," without committing to a lock-up ratio or liquidation pace.
- Due to a lack of on-chain details and official quantitative data support, it is currently impossible to assess their specific asset liquidation plans, and related concerns continue to ferment in community discourse.
Resonance with Industry Background and Market Sentiment
This round of layoffs and restructuring is not an isolated event but resonates with the structural changes in the entire public chain and L2 industry from 2023 to 2024: as Ethereum's scaling shifts from "single L2 competition" to a new phase of "multiple L2 coexistence and aggregation," the choices made by project parties regarding product lines, narratives, and funding allocation begin to directly impact market confidence and valuation pricing. Polygon's decision to increase the weight of AggLayer over zkEVM essentially aligns with the broader trend of "multi-rollup aggregation," but it also triggers emotional fluctuations among early zkEVM users and developers—especially in the absence of clear, quantifiable disclosures of funding and technical milestones, the market is more likely to interpret "layoffs + strategic adjustments" as potential risk signals.
Positive Confrontation of Bullish and Bearish Views
● Optimistic/Supportive View:
- It is believed that Polygon's proactive slimming down during the bear market cycle is a typical "leverage restructuring for the next cycle," rather than a liquidity crisis:
- The two rounds of layoffs have optimized about nearly 40% of the workforce, helping to compress fixed costs and allocate more funds to core R&D and ecological incentives;
- Focusing on AggLayer and zk technology stack aligns with the Ethereum ecosystem's major trend of "multi-rollup + shared liquidity";
- The treasury's claim of being "capable of supporting years" combined with the provision of three months of compensation to laid-off employees is seen as a signal that funds remain relatively abundant.
● Pessimistic/Opposing View:
- Concerns are raised that Polygon is experiencing a "contraction period after rapid expansion," with uncertainties regarding its long-term competitiveness:
- Frequent layoffs may dampen internal morale and increase the risk of losing core technical talent;
- zkEVM being repositioned from a "flagship product" to a "technical component" is interpreted by some in the community as a "downgrade of expectations";
- The lack of transparency regarding the treasury's scale and liquidation pace makes it difficult for the market to assess medium- to long-term selling pressure and the sustainability of ecological incentives.
Future Observations and Potential Variables
In the short term, the market will focus on several key points: first, whether Polygon will release a more detailed AggLayer technical roadmap and launch timeline within the next quarter; second, whether zkEVM can provide convincing data regarding mainnet stability, costs, and the number of ecological applications; third, whether the foundation will launch a new round of ecological incentives or developer funding programs to offset the negative sentiment brought about by layoffs. For investors and developers, Polygon's performance in the coming months regarding technical implementation and funding transparency will determine whether this round of restructuring is characterized as "an active evolution for survival" or "a passive contraction for defense."
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