The NEO project's treasury, valued at hundreds of millions of dollars, has been managed through personal wallets with little oversight, a setup that co-founder Da Hongfei considers unusual for most financial institutions. According to Da, co-founder Erik Zhang controls around 85% of the project's assets, including native NEO and GAS tokens worth between $200 million and $250 million, with single-signature authority and no multi-signature protections.
Da estimates that the tokens' current value exceeds the project's $197 million market capitalization. The two co-founders have been publicly airing their disputes since December, resulting in rival governance plans and an unsuccessful mediation effort in Hong Kong. Da's proposal, published on GitHub, calls for the Neo Foundation to be redomiciled 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 tokens to tokenholders.
In contrast, Zhang's counter-proposal suggests maintaining the Foundation's current location and governance structure, with himself remaining on the board. Zhang's plan also includes a formal investigation into historical asset management, addressing potential corruption, improper asset transfers, and concealment of public assets. Da dismisses these provisions, 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: the native NEO and GAS tokens, largely under Zhang's single-signature control, and the non-token assets, including bitcoin, ether, stablecoins, and fund-of-fund investments, managed by NGD, the entity Da runs. Da frames his proposal as a mutual disarmament, where both he and Zhang would sacrifice their individual control over assets.
However, the success of Da's restructuring plan depends on Zhang's cooperation, particularly in transferring the single-signature token holdings to a multi-signature lock address.