Co-Founder Holds Keys to $200 Million in Crypto, Sparking Governance Debate

The cryptocurrency project NEO has been operating with an unconventional financial setup, where hundreds of millions of dollars in crypto assets have been controlled by personal wallets with no multisig protections and little formal oversight. According to co-founder Da Hongfei, the person controlling around 85% of the funds is Erik Zhang, the other co-founder and architect of NEO's core protocol. The native NEO and GAS tokens held by Zhang are currently worth between $200 million and $250 million. Da has proposed a restructuring plan that includes redomiciling the Neo Foundation to the Cayman Islands, replacing the current governance with an independent five-member board, and redistributing tokens to holders. Zhang has countered with a proposal that includes staying on the board, keeping the Foundation in Singapore, and conducting a formal investigation into historical asset management. The two co-founders have been publicly airing their disputes since December, resulting in rival governance plans and an unsuccessful mediation effort. Da's proposal aims to introduce mutual disarmament, where both he and Zhang would sacrifice their individual control over assets. However, the success of this plan depends on Zhang's cooperation, and it remains to be seen if he will agree to transfer the single-signature token holdings to a multisig lock address.