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

For years, the NEO treasury was managed through an unconventional setup, with hundreds of millions of dollars in crypto assets controlled by personal wallets, lacking multisig protections and formal oversight. According to co-founder Da Hongfei, the individual controlling around 85% of these assets with a single signature is Erik Zhang, the other co-founder and architect of NEO's core protocol. Da estimated that the native NEO and GAS tokens held by Zhang are currently worth between $200 million and $250 million. This amount exceeds NEO's current market capitalization of $197 million. Zhang has retaliated with accusations against Da, and the two founders have been publicly disputing since December. The dispute has led to rival governance plans and an unsuccessful mediation effort in Hong Kong. Da has proposed a restructuring plan that involves redomiciling the Neo Foundation from Singapore to the Cayman Islands, replacing the current two-founder governance with an independent five-member board, and redistributing approximately 26 million NEO and 40 million GAS to tokenholders. In contrast, Zhang's counter-proposal suggests maintaining the Foundation's current location in Singapore and keeping himself on the board. Zhang's plan also calls for a formal investigation into historical asset management, addressing potential corruption, improper asset transfers, and concealment of public assets. Da has dismissed these accusations, stating that there is no corruption or misuse of funds. However, some observers find the numbers striking, with NEO's treasury holding around $460 million in assets, roughly double the project's market value, while the token has dropped 98% from its 2018 peak. The treasury is split into two halves, with the native NEO and GAS tokens largely under Zhang's single-signature control, and the second half, comprising bitcoin, ether, stablecoins, fund-of-fund investments, and bank balances, managed by NGD, the entity run by Da. Da has framed his proposal as a form of mutual disarmament, where both he and Zhang would sacrifice their individual control over assets. He expressed willingness to cooperate but is uncertain about Zhang's stance. The success of Da's restructuring plan depends entirely on Zhang's cooperation, particularly in transferring the single-signature token holdings to a multisig lock address. If Zhang refuses, Da believes the community should decide the next course of action.