The management of a cryptocurrency project's treasury, worth hundreds of millions of dollars, has been controlled by a single individual, Erik Zhang, with no multisig protections in place. This unusual setup has been in place for years, with Zhang holding around 85% of the project's native tokens, currently valued between $200 million and $250 million. Da Hongfei, the project's other co-founder, has proposed a restructuring plan that includes the creation of an independent five-member board, the redistribution of tokens to holders, and the transfer of token holdings to a multisig lock address. In contrast, Zhang's counter-proposal calls for a formal investigation into historical asset management and the retention of his role on the board.
The dispute between the two co-founders has been ongoing since December and has resulted in rival governance plans and an unsuccessful mediation effort. The project's treasury holds approximately $460 million in assets, which is roughly double the project's market value, and includes over 1,100 BTC, $100 million in stablecoins and cash, and a portfolio of venture investments. Da has framed his proposal as a form of mutual disarmament, where both he and Zhang would relinquish control over the project's assets.
However, the success of this proposal depends on Zhang's cooperation, and it remains to be seen whether he will agree to transfer the single-signature token holdings to a multisig lock address.