The treasury of the NEO project has been managed in an unconventional manner, with hundreds of millions of dollars in crypto assets controlled by personal wallets lacking multisig protections and formal oversight. According to Da Hongfei, co-founder of NEO, Erik Zhang, the project's other co-founder, has sole control over around 85% of the assets, valued between $200 million and $250 million, with no multisig setup in place. Da estimated that the native NEO and GAS tokens held by Zhang are worth more than the project's current market capitalization of $197 million. 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 has proposed a restructuring plan that involves redomiciling the Neo Foundation from Singapore to the Cayman Islands, establishing 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 current governance structure and staying on the board, while also calling for a formal investigation into historical asset management. Da has dismissed Zhang's accusations of potential corruption and misuse of funds, stating that there is no evidence to support these claims.
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 under Zhang's 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.