A Co-Founder Controls $200 Million in Crypto for a Project, Sparking Governance Debate

The NEO project's treasury has been managed through a unique setup, with hundreds of millions of dollars in crypto assets controlled by personal wallets and lacking multi-signature protections or formal oversight. According to co-founder Da Hongfei, Erik Zhang, the project's other co-founder and core protocol architect, holds around 85% of the assets, valued between $200 million and $250 million, with single-signature control. Da estimates that the native NEO and GAS tokens held by Zhang are currently worth more than the project's $197 million market capitalization. The two co-founders have been publicly disputing since December, resulting in rival governance plans and an unsuccessful mediation effort in Hong Kong. Da has proposed a restructuring plan, which includes 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 involves staying on the board, keeping the Foundation in Singapore, and conducting 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, while the token has dropped 98% from its 2018 peak. The treasury is split between two halves, with the native NEO and GAS tokens under Zhang's single-signature control and the non-token assets, including bitcoin, ether, and stablecoins, 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 restructuring depends on Zhang's cooperation, and Da is unsure if Zhang is willing to cooperate. If Zhang refuses, Da believes the community should decide the next course of action.