A Single Individual Controls $200 Million in Crypto Assets, Sparking Governance Debate

For an extended period, the treasury of NEO has been managed through an unconventional setup, with hundreds of millions of dollars in cryptocurrency assets controlled by personal wallets, lacking multi-signature protections and formal oversight. According to co-founder Da Hongfei, the individual responsible for this arrangement is Erik Zhang, the other co-founder and architect of the core protocol. Da stated in an interview, 'Approximately 85% is controlled by Eric alone with a single signature. It has never been transferred to any individual or multi-signature account.' The native NEO and GAS tokens held by Zhang are currently valued between $200 million and $250 million, as estimated by Da, surpassing NEO's current market capitalization of $197 million. Zhang, on the other hand, has made 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 attempt in Hong Kong. Da published his restructuring proposal on GitHub on April 9, 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 barring both founders from the board for 24 months. Additionally, the proposal suggests redistributing roughly 26 million NEO and 40 million GAS to tokenholders. In contrast, Zhang's counter-proposal involves staying 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, double the project's market value, while the token has dropped 98% from its 2018 peak. The situation can be viewed as a stalemate, with neither party willing to relinquish control. Da framed his proposal as a form of mutual disarmament, where both he and Zhang would sacrifice individual control over assets. The outcome depends on Zhang's cooperation, and the community may need to intervene if an agreement is not reached.