The treasury of the NEO project has been managed in an unconventional manner, with hundreds of millions of dollars in crypto assets controlled through personal wallets without multi-signature protections or formal oversight. According to co-founder Da Hongfei, the individual in control of these assets is Erik Zhang, the project's other co-founder and architect of its core protocol. Da estimates that Zhang holds between $200 million and $250 million in NEO and GAS tokens, exceeding the project's current market capitalization of $197 million.
The two co-founders have been publicly disputing their differences 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 in the Cayman Islands, the establishment of an independent five-member board, and the redistribution of approximately 26 million NEO and 40 million GAS tokens to tokenholders. In contrast, Zhang's counter-proposal involves remaining on the board and keeping the Foundation in Singapore. Zhang's plan also includes a formal investigation into historical asset management, addressing potential corruption, improper asset transfers, and concealment of public assets.
Da has dismissed these allegations, 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, with the token having dropped 98% from its 2018 peak. The treasury is split between two halves, with the native NEO and GAS tokens largely 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 on Zhang's cooperation, and Da has stated that if Zhang refuses, the community should decide the next course of action.