StrakWare, the blockchain company behind Starknet, is pivoting its business and reducing its workforce due to the massive loss in revenue recorded by the company’s major network.
The company intends to create two different business units as it reorients itself from just growing Ethereum-based infrastructure to creating products that will bring in revenue.
The pivot has been necessitated by the massive fall in revenue recorded by Starknet, where revenue was down more than 99 percent from its peak.
The downturn was primarily the result of diminished network activity and slower-than-anticipated adoption rates.
Given that the network’s earnings are tightly linked to transaction volume, the slowdown has directly impacted the company’s financial performance.
StarkWare, a blockchain startup established in 2018, is focused on scaling the Ethereum blockchain using zero-knowledge (ZK) technology. The firm develops Validity Rollups, employing StarkEx and StarkNet. These systems use off-chain transaction batching and ZK-STARKs, a form of cryptographic proof, to ensure secure transactions and lower costs.
These layoffs are just one piece of a broader pattern of job losses rippling through the cryptocurrency industry. Since early 2026, the industry has seen significant staff reductions, a reflection of challenging market conditions and the increasing use of AI in processing.
The number of job postings has fallen by almost 80 percent compared to the year before, according to the latest January 2026 reports from Binance.
CEO urges shift to revenue-focused products
During a company-wide town hall, CEO Eli Ben-Sasson told employees the company needs to become more commercially focused. Rather than depending on the growth of the ecosystem in the long run, StarkWare is now looking forward to building its own products and services, which will provide stable income in the short run.
The decision includes laying off employees as a cost-saving measure. More broadly, the move reflects a wider trend across the crypto industry, where infrastructure firms are under pressure to prove sustainable business models rather than depending solely on future adoption.
Starknet revenue falls from peak level
Revenue on the Starknet has dropped significantly from its earlier highs, reflecting broader changes in how Layer 2 networks make money. The network once generated close to $6 million in a single month in late 2023, but by mid-April 2026, revenue had fallen to roughly $48,000, according to data from DefiLlama.
Part of the decline is due to industry-wide shifts rather than a problem unique to Starknet. A major factor was the rollout of the Ethereum EIP-4844 upgrade in March 2024.
The upgrade resulted in lower costs being incurred during transactions conducted in Layer 2 networks that run on top of the Ethereum network. This meant that while this improved the situation for users, it lowered the income for Layer 2 networks.
Even so, the network’s Total Value Locked (TVL) remains above $200 million, suggesting that users and developers are still active and keeping funds on the platform. The statistics indicate continued trust in the technology, even if income from fees has slowed.
Restructuring will see StarkWare launch new applications
As part of the restructuring, StarkWare is launching a new Applications unit focused specifically on building revenue-generating products. The unit will be led by researcher Avihu Levy, whose recent work reflects the kind of specialized innovation the company wants to prioritize.
Levy recently introduced a concept known as Quantum Safe Bitcoin, designed to protect Bitcoin transactions from potential future threats posed by quantum computing, without requiring changes to the underlying network.
Nonetheless, there are some cons to consider. Although it enhances the security process, it is quite costly compared to other methods since it requires a lot of capital to be implemented successfully. The technology is most likely best suited for particular applications that require enhanced protection measures.
In summary, the transition demonstrates that StarkWare is now moving into a practical stage where it will produce fewer products that will earn it revenue.
StarkWare CEO makes future plans clear
StarkWare CEO Eli Ben-Sasson made it clear in the town hall address that the company now needs to turn its technical strengths into real usage and steady revenue.
The firm is reducing its scope in light of changes in the business landscape, showing that it’s moving away from the idea of experimenting with various approaches toward developing something profitable.
Ben-Sasson also spoke about the general condition of the entire industry, saying that although they have seen several bearish periods in his career since becoming involved in crypto back in 2013, the current one seems special.
In accordance with StarkWare, the current condition of the blockchain industry is defined by a certain lack of clear guidance and leadership, including in leading platforms such as Bitcoin and Ethereum.