Matter Labs Faces Lawsuit Over Alleged Technology Theft

Matter Labs, the developer behind the layer-2 blockchain ZKSync, is facing a lawsuit from BANKEX, a defunct digital asset banking platform. The lawsuit alleges that former BANKEX employees, Alexandr Vlasov and Petr Korolev, stole the company's technology to establish Matter Labs. According to the complaint filed on March 19 with the New York State Supreme Court, Vlasov and Korolev were tasked with completing the Plasma project for BANKEX, which was approached by Ethereum co-founder Vitalik Buterin in 2017 to build operational software for the technology.

However, the complaint alleges that instead of completing the project for BANKEX, Vlasov and Korolev secretly developed Matter Labs. They are accused of appropriating BANKEX’s technology for their own use and benefit, and covertly transferring the company’s technology and operational code bases to Matter Labs using BANKEX’s resources and funding. Vlasov is currently the head of R&D at Matter Labs, while Korolev is the founder of blockchain security firm OXORIO.

In addition to Vlasov and Korolev, the lawsuit also names Matter Labs co-founder Alex Gluchowski, crypto-native investment fund Dragonfly, and Chris Burniske, a partner at Placeholder Capital and a former co-director at Matter Labs, for their alleged involvement and knowledge of the theft.

Matter Labs has denied the allegations, stating that ZKSync is original technology not based on or derived from any code developed by BANKEX. The company expressed confidence in the integrity of its work and looks forward to addressing the allegations in court.

BANKEX's lawyer, Clayton Mahaffey, reiterated the firm's belief in the well-founded allegations and expressed eagerness to present their case in court.

This legal dispute highlights the complexities and potential risks associated with intellectual property in the rapidly evolving blockchain industry. The outcome of this lawsuit could have significant implications for the industry, particularly in terms of how companies handle and protect their proprietary technologies.