Project Analysis: ZkSync (Matter Labs)

In the "Project Analysis" series, our team of researchers explore some of the most noteworthy and interesting fund-raises that have taken place (or that are taking place right now!). The output of the analysis has been summarised in order to provide you with some detailed yet easy to digest information.

Executive summary

New investment opportunity - ZkSync (Matter Labs)- round: total of $258M in funding over 4 rounds. Their latest funding was raised on Nov 16, 2022 from a Series C round.

• Homepage: https://matter-labs.io/

• Explorers:

  • V. 1.0 Mainnet: https://zkscan.io/;

  • V. 2.0 Testnet: https://explorer.zksync.io/, https://zksync2-testnet.zkscan.io/

• Product: Layer 2, soon L3 “Pathfinder”

• Language: supports Account Abstraction, Solidity and Vyper

• Use-Case: Zk-Rollup. EVM compatible - ZkSync 1.0 (limited to swap, trading, paying) - V2 is the first general purpose Rollup (deploy contract etc)

• Team: Alex Gluchowski Founder and CEO; Marco Cora Head of Business Development; Petr Korolev Head of Operations; Angela Lu Product.

• Social Stats: Twitter - 494k; Discord - 249K;

• Funding Round & Valuation:

  • $258M Funding - https://astrol.pro/project/279

  • 200 million grant: Commitment by BitDAO across 5 tranches, first tranche being $40M, and subsequent tranches will be released based on achieved milestones and BitDAO governance vote approval. https://zkdao.io/

• Investors: Seed - Placeholder, DragonFly, 1KX. Series - A16Z, Lightspeed Ventures, Coinbase ventures, Aave, Consensys, Crypto.com, Covalent, Alchemy, et alia.

• Competitors: Aztec, Starkware, Polygon, Scroll.

Valuation

Pros:

• Leading General purpose zk-Rollup, with fast-paced development compared to competitors.

• Well founded, with 200mil (40mil available) for Ecosystem grants and development

• Layer 3 coming Q1 2023, with

Cons:

• High competition for Dapps and “Dapp chains”.

Future Development: zkSync’s EVM-compatible Layer 3 ‘Opportunity’ prototype will be deployed to public testnet in the first quarter of 2023.

Deal Structure

Raised a total of $258M in funding over 4 rounds. Their latest funding was raised on Nov 16, 2022 from a Series C round. The main source we used can be found here.

Product Use Case

Target: dApp developers, Ethereum users.

Problem: Gas Fees, Scalability.

Features:

• zkSync Layer 2 - V.1 - limited to swap, trading, paying

• zkSync Layer 2 - V.2 - General Purpose

  • General-Purpose ZK Rollup — To support general-purpose applications

  • EVM-Compatible — To enable easy porting

  • Solidity Support — To support the most common language for smart contract developers

  • Open Source — To protect the freedoms to view, change, or fork the code

  • Ethereum Ethos Compatible — To represent the values of the ecosystem with a decentralization model

• zkSync Layer 3 - Pathfinder

  With zkSync’s Layer 3 solution, developers will be able to choose from 3 data availability options all using the same proving infrastructure for their project. Developers can choose their own trade-offs between price, performance, and security.

  • Zk rollup — Choose this if you want to have the full security of Ethereum (Good for DeFi).

  • ZkPorter — Choose this if you want a mixture of your data to be made on-chain and off-chain to optimize for cheap, fast, and secure (good for gaming).

  • Validium — Choose this if you want ultimate performance with slightly less security than Ethereum (Limitless Use Cases).

Written with ♥️ & 🧠 by Mark Mercatali (find me on Twitter and LinkedIn).

Disclaimer: This analysis is not intended as investment advice, but is published for informational purposes only. As always, we strongly advise to do your own research. If you do find any misleading or incorrect information please report it to info@3vlabs.io.