For several years, NEO's treasury was managed in an unconventional manner, with hundreds of millions of dollars in cryptocurrency assets controlled by personal wallets lacking multi-signature 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 stated in an interview, 'Around 85% is controlled by Eric alone with a single signature. It has never been transferred to any individual or multi-signature setup.' The native NEO and GAS tokens held by Zhang are currently valued between $200 million and $250 million, exceeding NEO's current market capitalization of $197 million. Zhang has countered with accusations against Da, and 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 published his restructuring proposal on GitHub on April 9, which includes redomiciling the Neo Foundation 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 token holders.
Zhang's counter-proposal involves remaining on the board and keeping the Foundation in Singapore. Zhang's proposal also calls for a formal investigation into historical asset management, addressing potential corruption, improper asset transfers, and concealment of public assets. Da dismissed these provisions, stating, 'I think it's a very blunt and empty accusation. There is no corruption, no misuse of funds.' However, some observers find the numbers striking, with NEO's treasury holding approximately $460 million in assets, roughly double the project's market value, while the token has dropped 98% from its 2018 peak.
Da's proposal is framed as mutual disarmament, where both he and Zhang would sacrifice their individual control over assets. The outcome depends on Zhang's cooperation, and Da has committed to a one-to-three month timeline for the restructuring. If Zhang refuses, Da believes the community should decide the next course of action.