A Single Individual Controls $200 Million in Crypto Assets, Sparking Calls for Governance Reform

For years, the NEO project's treasury has been managed through an unconventional setup, with hundreds of millions of dollars in crypto assets controlled by personal wallets lacking multi-signature protection and formal oversight. According to Da Hongfei, co-founder of NEO, the individual in control of these assets is Erik Zhang, the project's other co-founder and core protocol architect. Da estimates that Zhang alone controls around 85% of the assets, valued between $200 million and $250 million, using a single signature, with no transfer to a multi-sig or individual. The native NEO and GAS tokens held by Zhang exceed the project's current market capitalization of $197 million. The two co-founders have been publicly disputing since December, resulting in rival governance plans and an unsuccessful mediation effort. Da has proposed a restructuring plan, which involves redomiciling the Neo Foundation to the Cayman Islands, establishing an independent five-member board, and redistributing approximately 26 million NEO and 40 million GAS tokens to tokenholders. In contrast, Zhang's counter-proposal suggests maintaining the current governance structure and staying on the board, while also calling for a formal investigation into historical asset management to address potential corruption and improper asset transfers. Da has dismissed these accusations, stating that there is no corruption or misuse of funds. The project's treasury holds around $460 million in assets, roughly double its market value, with the token having dropped 98% from its 2018 peak. The treasury is split between two halves, with the native tokens controlled by Zhang and the non-token assets 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 individual control over assets. However, the success of this proposal depends on Zhang's cooperation, and Da has expressed uncertainty about whether Zhang is willing to cooperate.