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 and lacking multisig protections or formal oversight. According to co-founder Da Hongfei, Erik Zhang, the project's other co-founder and core protocol architect, holds around 85% of the assets, worth between $200 million and $250 million, with single-signature control.

Da estimates that the native NEO and GAS tokens held by Zhang are currently valued at over $197 million, exceeding the project's current 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, while also calling for a formal investigation into historical asset management to address potential corruption and improper asset transfers. Da has dismissed these allegations, stating that there is no evidence of corruption or misuse of funds. However, some observers have raised concerns about the project's treasury, which holds approximately $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 relinquish their individual control over the assets. The success of this proposal depends on Zhang's cooperation, and Da has committed to a one-to-three month timeline for the transfer of single-signature token holdings to a multisig lock address.

If Zhang refuses, Da believes the community should decide the next course of action.