In a dramatic turn of events shaking the cryptocurrency world, Neo co-founders Da Hongfei and Erik Zhang have entered a public dispute over the blockchain’s governance and financial management, highlighting critical questions about decentralisation and transparency.
First reported by Wu Blockchain on December 15, 2024, the conflict exposes deep divisions within one of the leading Layer 1 blockchain projects, potentially affecting investor confidence and the platform’s long-term stability.
Conflict over fund control and governance
Originally launched as Antshares in 2014 and rebranded to Neo in 2017, the blockchain positions itself as a “smart economy” platform competing with Ethereum and other Layer 1 networks.
The public clash between its co-founders comes at a sensitive time as regulatory scrutiny intensifies and institutional investors increasingly demand transparency and accountability in blockchain projects.
The dispute centres on control of Neo’s funds and consensus mechanisms.
Da Hongfei has publicly claimed that Zhang controls the majority of Neo’s financial resources and voting power over the network’s consensus nodes.
Da argues this centralisation contradicts the decentralised principles typically championed by blockchain projects and alleges that Zhang has delayed transferring personally managed NEO and GAS tokens to the Neo Foundation’s multi-signature wallet, a standard security practice in cryptocurrency governance.
Industry experts note that Neo’s governance challenges reflect broader issues in the blockchain sector.
Dr. Sarah Chen, a blockchain governance specialist, observed that “many blockchain projects start with centralised development teams, and transitioning to decentralised governance can create tension.”
Financial transparency concerns
Zhang has countered Da’s allegations by calling attention to the lack of transparency in the Neo Foundation’s financial reporting.
He has urged for a comprehensive, verifiable report of the foundation’s finances, reflecting growing expectations in the crypto sector for clear oversight of token treasuries and development funds.
In response, Da has committed to releasing the foundation’s financial report in the first quarter of 2026, though the timing raises questions about why such disclosure was not already standard practice.
The Neo Foundation, tasked with supporting blockchain development and ecosystem growth, reportedly controls significant holdings of NEO and GAS tokens.
However, the precise amounts remain undisclosed, a situation that has sparked concerns among institutional investors seeking assurance of governance clarity and financial accountability.
Leadership transition
Adding complexity to the dispute, Erik Zhang confirmed that Da Hongfei plans to step back from direct involvement in Neo’s mainnet development starting January 1, 2026.
Instead, Da will concentrate his efforts on NeoX, Neo’s ambitious cross-chain interoperability protocol, and SpoonOS, a blockchain operating system designed to streamline the creation and deployment of decentralised applications (dApps).
Neo co-founder Erik Zhang accused Da Hongfei of failing to disclose Neo Foundation finances and urged a full, verifiable report. He said Da will step back from Neo mainnet work from Jan. 1, 2026, to focus on NeoX and SpoonOS. Da Hongfei replied that Zhang controls most Neo funds
This transition marks a significant shift in Neo’s leadership and raises critical questions about the platform’s future direction.
While Da’s move could allow him to focus on innovative expansions beyond Neo’s current smart contract platform, it also places greater responsibility on Zhang and the remaining leadership to ensure stability and continuity in core network operations.
The timing of this announcement, amid a public dispute over governance and fund control, intensifies concerns about potential strategic misalignment within the project.
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