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 multi-sig protections and formal oversight. According to co-founder Da Hongfei, Erik Zhang, the other co-founder and architect of NEO's core protocol, holds around 85% of the assets, worth between $200 million and $250 million, with single signature control.
Da estimated that the native NEO and GAS tokens held by Zhang are currently valued at over $197 million, exceeding NEO's market capitalization. The two 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 to tokenholders. In contrast, Zhang's counter-proposal suggests staying on the board and keeping the Foundation in Singapore.
Zhang's proposal also calls for a formal investigation into historical asset management, including provisions to address potential corruption and improper asset transfers. Da dismissed these accusations, stating that there is no corruption or misuse of funds. The treasury holds 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 between two halves, with the native NEO and GAS tokens under Zhang's single-signature control, and the second half, comprising bitcoin, ether, stablecoins, and fund-of-fund investments, managed by NGD, the entity run by Da. Da framed his proposal as mutual disarmament, where both he and Zhang would sacrifice their individual control over assets. However, the success of this proposal depends on Zhang's cooperation, and Da is uncertain if Zhang is willing to comply.