Matter Labs is a German-based company developing the zkSync technology — a layer-2 scaling solution for Ethereum that aims to improve transaction throughput and reduce gas fees. [1][2][3]

Overview

Founded by Alex V. and Alex G., Matter Labs is working to scale Ethereum using zero-knowledge proofs, a technology seen as essential for the mainstream adoption of public blockchains. Since its launch in the summer of 2020, Matter Labs' zkSync has been operational, providing cheaper crypto payments and aiming to scale arbitrary smart contracts, including those written in Solidity within a ZK rollup. [2][3]

"At Matter Labs, we believe Freedom leads to Progress and Prosperity. Therefore, we made it our mission to advance personal freedom for all" - Matter Labs' mission statement

Matter Labs operates with an open-source development approach and a result-oriented mindset. [2]

Matter Labs raised $2 million in a seed round in September 2019 and another $6 million in a Series A round in February 2021 from crypto companies like Binance, Aave, Curve, and Coinbase Ventures. Its Series B raise in November 2021 saw another $50 million raised from venture capital funds like a16z, Dragonfly, and Placeholder. In January 2022, the company was backed with another $200 million by BitDAO. [11]

zkSync

ZKSync is a layer-two blockchain for Ethereum using zk-rollups as scaling technology. Like optimistic rollups, zk-rollups roll up transactions off the Ethereum mainnet and submit the transaction proofs to Ethereum. This means hundreds of transactions are batched into one, which is verified and secured by Ethereum. [11][10]

Zero-knowledge proofs, or zk-Proofs, have active cryptographic security. For instance, zk-Rollup solutions determine the integrity of a transaction without disclosing the supporting evidence. [[11]

Controversy

In May 2024, Matter Labs filed trademark applications in nine countries to claim the term “zero-knowledge” as the firm’s exclusive intellectual property, outraging the crypto industry. Matter Labs had already attempted to register a token with the symbol “ZK” with cryptocurrency exchanges, in an attempt to consolidate their claim on the technology. [5]

According to Eli Ben-Sasson, CEO of StarkWare, the attempt by Matter Labs to register ZK technology represents an “absurd grab of intellectual property,” as stated:

“ZK CRYPTOGRAPHY WAS DEVELOPED FOR THE GOOD OF ALL. IT IS SHAMEFUL TO SEE A COMPANY TRYING TO MONOPOLIZE ‘ZK’ AS PRIVATE INTELLECTUAL PROPERTY. IT IS AS ABSURD AS A BAKER TRYING TO PATENT BREAD.”[4]

He also added that no single company should claim ZK technology as its own:

“ZK cryptography has massive potential for humanity — actually far beyond blockchain. We, in blockchain, are honored to be pioneering its first great use case – and hope this propels it to many other use cases.”[5]

Top industry experts have called for the withdrawal of Matter Labs’ trademark filing, which they called “oppressive behavior,” in a public letter shared with Cointelegraph. The public letter was signed by notable figures including Polygon co-founders Sandeep Nailwal and Brendan Farmer, StarkWare CEO Eli Ben-Sasson, Polyhedra Network co-founder and zkBridge inventor Tiancheng Xie, as well as Turing award winner and ZK-proofs co-inventor Shafi Goldwasser. [5]

The letter[12] notes:

“We believe that ZK is a public good that belongs to everyone. A company exploiting the legal system to annex a public good violates the crypto ethos, the Ethereum ethos, and the academic ethos. It even goes against Matter Labs’ own ethos which states "we can make this world better by increasing people's freedom”. If the company goes through with this it will be separating itself from the very community it claims to be a part of..." [12]

In response to Cointelegraph’s X post[6], Alex Gluchowski, the co-founder and CEO of Matter Labs, said he rejects “the very idea of intellectual property.” The post continued:

“All the trademarks we had ever registered, including ZK-related ones, are defensive, to prevent dishonest actors from misleading their customers and confusing their products and services with the ones offered by Matter Labs (as had unfortunately been the case in the past).

But ZK is the endgame, so we went one step further. We had earlier reached out to the legal team of the Ethereum Foundation and offered to cooperate on creating a legal framework to make the use of “ZK” and similar important tech terms in the public domain. We invite others to participate in this initiative – in particular, those who filed trademarks related to STARKs."[7]

Matter Labs also sought to defend its trademark application via tweet, arguing that trademarks are the only means to guarantee its ability to freely use the term “ZK” for its products that don the two letters in their name. [8]

"ZK technology belongs to the community. Full stop. We applied for ZK-related trademarks to ensure that the term “ZK” can be used freely in the context of “ZK Sync”, “ZK Stack” and other related names. Like it or not, trademarks are the only legal tool available for this today.

“A common misconception is that having a trademark means you legally own a particular word or phrase and can prevent others from using it. However, you don’t have rights to the word or phrase in general, only to how that word or phrase is used with your specific goods or services." (*)[9]

Matter Labs added that it was committed to finding a structure for the ZK trademark that benefits everybody building with zero-knowledge technology, even claiming to have reached out to the Ethereum Foundation^[1] in a bid to collaborate on establishing a legal framework placing the term “ZK” in the public domain. [8]

That said, we are committed to finding an appropriate structure for the ZK trademark that is accessible to everyone building ZK tech. We invite other ZK projects to join this effort. ZK technology, and the term ZK in particular, is and must always remain a public good, freely available to all. [9]

However, after much feedback from its community, on June 3rd, 2024, Matter Labs announced via X (formerly known as Twitter) that they would withdraw all trademark applications for the term “ZK”.

This decision followed extensive discussions, highlighting the difficulty of establishing a universally accepted, credibly neutral group to manage the trademark. While such a framework might be feasible within the Ethereum community, it was deemed unworkable globally.[13]