Co-Founder Holds Keys to $200 Million in Crypto, Sparking Governance Dispute

For years, the NEO project's treasury was managed through an unconventional setup, with hundreds of millions of dollars in crypto assets controlled by personal wallets, lacking multi-sig protection and formal oversight. According to co-founder Da Hongfei, the individual in control of these assets is Erik Zhang, the other co-founder and architect of NEO's core protocol. Da estimates that Zhang alone holds around 85% of the assets, worth between $200 million and $250 million, with single signature control. The native NEO and GAS tokens held by Zhang are valued at more than the project's current $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 has proposed a restructuring plan, which includes relocating the Neo Foundation from Singapore to the Cayman Islands, establishing an independent five-member board, and redistributing approximately 26 million NEO and 40 million GAS tokens to holders. In contrast, Zhang's counter-proposal involves maintaining the current governance structure, with him remaining on the board, and calls for a formal investigation into historical asset management, including potential corruption and improper asset transfers. Da has dismissed these accusations, stating that there is no corruption or misuse of funds. The NEO 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 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 their individual control over assets. However, the success of this proposal depends entirely on Zhang's cooperation, and it remains uncertain whether he will agree to transfer the single-signature token holdings to a multi-sig lock address.