The financial setup of a prominent cryptocurrency project has been called into question, as hundreds of millions of dollars in crypto assets are controlled by a single individual through personal wallets, lacking multisig protections and formal oversight. According to co-founder Da Hongfei, this individual is Erik Zhang, the project's other co-founder and core protocol architect.
Da estimates that Zhang holds between $200 million and $250 million in native tokens, exceeding the project's current market capitalization. The two co-founders have been publicly disputing since December, resulting in rival governance plans and an unsuccessful mediation effort. Da has proposed a restructuring plan, which includes redomiciling the foundation to the Cayman Islands, replacing the current governance with an independent board, and redistributing tokens to holders. In contrast, Zhang's counter-proposal involves staying on the board and keeping the foundation in Singapore, as well as a formal investigation into historical asset management.
The dispute has sparked concerns among observers, given the project's significant treasury holdings and the token's substantial price drop. Da views his proposal as a form of mutual disarmament, where both he and Zhang would sacrifice individual control over assets. However, the outcome depends on Zhang's cooperation, and the community may need to intervene if an agreement is not reached.