A Single Individual Controls $200 Million in Crypto for a Project, Prompting Calls for Change

For a long time, the treasury of NEO was managed in an unconventional manner, with hundreds of millions of dollars in cryptocurrency assets controlled through personal wallets, lacking multi-signature protections and formal oversight. According to co-founder Da Hongfei, this individual is Erik Zhang, the other co-founder and architect of NEO's core protocol. Da stated, 'Around 85% is controlled by Eric alone with a single signature. It has never been transferred to any individual or multi-sig.' The NEO and GAS tokens Zhang holds are currently valued between $200 million and $250 million, as estimated by Da, exceeding NEO's current market capitalization of $197 million. Zhang, in turn, has accused Da of separate issues, and the two founders have been publicly disputing since December. The dispute has led to rival governance plans and an unsuccessful mediation attempt in Hong Kong. Da published his restructuring proposal on GitHub on April 9, which includes relocating the Neo Foundation from Singapore to the Cayman Islands, replacing the current two-founder governance with an independent five-member board, and preventing both founders from serving on the board for 24 months. Additionally, it involves redistributing approximately 26 million NEO and 40 million GAS to token holders. In contrast, Zhang's counter-proposal suggests remaining on the board and keeping the Foundation in Singapore. Zhang's proposal also calls for a formal investigation into historical asset management, addressing potential corruption, improper asset transfers, and concealment of public assets. Da dismissed these provisions, stating, 'I think it's a very blunt and empty accusation. There is no corruption, no misuse of funds.' However, some observers find the numbers striking, with NEO's treasury holding approximately $460 million in assets, roughly double the project's market value, while the token has dropped 98% from its 2018 peak. Da views his proposal as a form of mutual disarmament, where both he and Zhang would relinquish control over the assets. 'NGD will lose its control over most of the assets, including the BTC and stablecoins, which are over $200 million. And Eric will lose his personal control of the majority of the NEO tokens,' Da explained. The success of Da's restructuring plan relies on Zhang's cooperation, particularly in transferring the single-signature token holdings to a multi-signature lock address. Da committed to a one-to-three month timeline but expressed uncertainty about Zhang's willingness to cooperate.