A long-standing issue with NEO's treasury has come to the forefront, as hundreds of millions of dollars in crypto assets are controlled by a single individual, Erik Zhang, without multisig protection or formal oversight. According to co-founder Da Hongfei, Zhang holds around 85% of the project's assets, valued between $200 million and $250 million, with single signature control.
The native NEO and GAS tokens have never been transferred to a multi-sig or any individual. Da estimates that the current market capitalization of NEO is around $197 million, making Zhang's holdings more valuable than the entire project.
The two co-founders have been at odds since December, with Zhang accusing Da of various problems and Da pushing for a restructuring plan that includes independent governance and the removal of both founders from the board for 24 months. Da's proposal, published on GitHub, calls for the Neo Foundation to be redomiciled from Singapore to the Cayman Islands and for the redistribution of roughly 26 million NEO and 40 million GAS to tokenholders.
In response, Zhang has proposed staying on the board and keeping the Foundation in Singapore, while also calling for a formal investigation into historical asset management. Da has dismissed these provisions as baseless accusations, stating that there has been no corruption or misuse of funds. The situation has led to a stalemate, with both founders holding significant control over the project's assets and neither willing to back down.
Da has framed his proposal as a form of mutual disarmament, where both he and Zhang would give up control over their respective assets. However, the success of this plan depends entirely on Zhang's cooperation, and it remains to be seen whether he will agree to transfer his single-signature token holdings to a multisig lock address.