Two proposals,
one community.
Let's close the gap.

Da frames Neo as at "an inflection point" and identifies three intertwined structural problems.

The first is a founder deadlock. The two founders have diverged in vision and priorities, blocking Foundation decisions on structure, strategy, spending, and leadership. The Singapore CLG's 1:1 founder-membership structure makes this paralyzing — either founder can unilaterally block any matter requiring member approval.

The second is on-chain governance dominated by foundation-controlled tokens, while broader tokenholder participation stays "negligibly low."

The third is Neo's current liquid voting mechanism itself. Da argues it produces four compounding effects: low engagement, opportunistic voting, passive proxy voting by exchanges and custodians with no governance intent, and a thin voting base that leaves consensus node elections vulnerable.

Da describes all three as "structural failures that will compound if left unaddressed."

Erik frames the problem as the absence of a stable governance framework appropriate to a public blockchain, with four intertwined elements.

The first is ambiguous authority boundaries between the Foundation, Board, Supervisor, and on-chain mechanisms.

The second is weak constraints on Neo Public Assets control — including assets nominee-held, custodied, or beneficially connected to Neo across NF, NGD, founders, and related entities.

The third is the lack of blockchain-verifiable community authorisation for significant decisions.

The fourth is unresolved historical conduct around Neo Public Assets, which Erik treats as a live governance problem requiring continuing review rather than a closed matter.

Erik links these gaps to diminished community confidence, ecosystem reliability, and project advancement efficiency. He calls for a durable system to "restore order, rebuild authorization mechanisms, clarify institutional duties, strengthen supervision," and recover the legitimacy appropriate to a public blockchain. Erik frames this work as "Governance Restoration" that "cannot remain delayed."

Da proposes five interdependent measures executed in a coordinated sequence over approximately 12 months across four phases:

• Phase 1 — Legal and governance foundation (Months 1–3). Redomicile to Cayman Islands, design the governance framework, and constitute the initial Board.
• Phase 2 — Secure assets and prepare upgrade (Months 2–5). Transfer tokens to the Giveback II Lock Address, begin asset consolidation, and develop staking specifications.
• Phase 3 — Network upgrade (Months 6–9). Submit and deploy the network upgrade covering staked voting, NEO divisibility, and Giveback II rebasing.
• Phase 4 — Operational transition (Months 9–12). Complete asset consolidation, establish financial reporting, and transition to the unified funding model.

Erik proposes four sequential phases without fixed timeframes:

• Phase I: Initiate Governance Restoration. Establish multi-party controls on Neo Public Assets, define key governance role loyalty duties and recusal rules, establish independent supervisory mechanisms, and formalise the five-seat Board functional divisions.
• Phase II: Constitutional Amendment and Organizational Reconstruction. Write on-chain governance binding effect into Foundation constitutions, formalise execution duties, supervisory duties, and breach consequences in institutional documents, and complete Board and Supervisor structured reconstruction.
• Phase III: On-Chain Community Authorization Framework Establishment. Formalise nomination and voting eligibility rules, establish major public matter on-chain authorisation rules, and lay institutional foundations for future NeoDAO native contracts, on-chain voting mechanisms, and execution infrastructure.
• Phase IV: Continuous Transparency, Liquidation, and Accountability. Establish financial and asset disclosure schedules, continue historical investment and control-structure explanation, conduct major historical matter special reviews, and execute liquidation, accountability, and recovery measures where problems confirm.

Da proposes redomiciling the Neo Foundation as a memberless Cayman Islands foundation.

He describes the Singapore CLG as "a conventional nonprofit corporate form centered on a small membership body — not a structure designed to steward a protocol commons with globally distributed, liquid stakeholders," and as a shell that has never functioned as the ecosystem's treasury or governance centre.

The 1:1 founder membership creates a deadlock risk — any matter requiring member approval, including structural reform, appointments, asset transfers, or crisis response, can be blocked by either founder unilaterally.

The Cayman form permits tailored bylaws with embedded tokenholder powers and oversight by an independent professional agency. Da frames this as "a constitutional reboot, not a change of address," and describes it as "establishing a legal architecture designed to facilitate the governance framework detailed in this proposal."

Erik does not set a specific new legal form in #4531.

His §V.3 lists "Foundation legal structure changes" among the major matters requiring prior on-chain community authorisation, and §VI.3 lists them among extraordinary matters requiring elevated voting thresholds.

Phase II of his implementation path amends the existing Foundation's constitutions to give on-chain governance outcomes constitutional-level binding force, alongside Board and Supervisor reconstruction.

Under this rule, any such change would need community authorisation before Foundation execution.

Da embeds tokenholder influence in the Foundation's bylaws, which define core governance processes and four named mechanisms: board nomination, supervisor ratification, impeachment, and emergency intervention.

He names the Grand Court of the Cayman Islands as a judicial backstop if internal mechanisms fail.

Erik proposes writing into the Foundation's constitutions that properly-formed on-chain resolutions have the "highest binding effect" in Foundation governance.

He explicitly rules out treating on-chain outcomes as "suggestions, political statements, or discardable community sentiment."

Directors, supervisors, and other roles bear execution duties within legal limits, and unjustified refusal, delay, or evasion of an effective resolution would be grounds for accountability, removal, or legal action.

Da proposes a five-seat Board of Directors as the Foundation's executive organ, responsible for strategy, budgets, oversight of delegated operators, and safeguarding the Foundation's assets and mission.

Erik proposes a five-member Board with explicit functional responsibilities covering essential governance capabilities. Board operation follows those responsibilities with substantive professional judgment in each domain.

Da proposes a Board of five whose composition is specified by background profile rather than by functional domain — a mix of community leaders, industry veterans, and at least one independent professional, chosen to ensure both ecosystem alignment and institutional rigor.

Directors serve two-year terms with one re-election allowed. The initial Board adopts a staggered rotation — three seats expire after the first term, two after the second.

Erik assigns each of the five seats to an explicit functional domain: Protocol and Architecture; Engineering and Infrastructure; Treasury, Audit and Compliance; Treasury Strategy and Investment; and Business Development and Strategic Partnerships.

Under §VI.2, major domain matters — protocol direction and upgrades, budget and audit systems, allocation and investment strategy, and major partnerships — require Board approval plus explicit support from the responsible seat, so that professional judgment substantively influences relevant decisions.

This follows Erik's §II.3 "corresponding authority and responsibility" principle.

Each founder nominates four independent candidates, producing a combined pool of eight. Independent community leaders and core developers then vote to pick the final five directors from that pool.

"Community leaders" are the heads of established sponsored communities. "Core developers" are those formally recognised on neo.org. Independence excludes anyone holding a position or partnership within either founder's initiatives.

Da frames this as giving both founders input into the Foundation's initial leadership while leaving the community as the decisive voice, and ensuring neither founder alone can determine the Board's composition.

Da proposes a 24-month exclusion as "a clean institutional break from the founder-dependent model": neither founder may serve on the Board or as Supervisor for the first two years after redomiciliation.

After that period, either founder may be nominated for a Board seat through the standard tokenholder nomination process, as a community member with no special status.

Da proposes that all Foundation roles — including Board directors and the Supervisor — be paid positions.

The compensation framework should be transparent and commensurate with the responsibilities and time commitment of each role.

Da proposes that the Supervisor be an independent professional agency, not an individual, to ensure continuity and impartiality.

The Supervisor can review, challenge, and where necessary block Board actions, but cannot direct operations. It monitors compliance with the Foundation's bylaws and fiduciary obligations, and may refer matters to the Grand Court if internal mechanisms fail.

Tokenholders ratify or reject the appointment by staked vote.

Erik proposes an independent Supervisor whose duties cover governance procedure oversight, conflict-of-interest review, compliance review of major resolutions, director performance supervision, community complaint handling, supervisory opinions on major matters, and triggering accountability procedures.

Erik frames oversight, procedure, and accountability as formal structural components of the Foundation — not advisory functions. The role is structurally distinct from Board membership.

Da addresses loyalty and conflicts of interest through specific structural mechanisms.

The Supervisor — an independent professional agency, not an individual — monitors compliance with the Foundation's bylaws, objects, and fiduciary obligations.

For the initial Board formation, "independent" status explicitly excludes anyone holding a position or partnership within either founder's initiatives.

Da does not set out a general duty-of-loyalty principle covering all governance roles.

Erik elevates Duty of Loyalty to one of seven fundamental governance principles (§II.4) and builds dedicated operational rules around it in §VII.2.

Directors, supervisors, and key personnel would explicitly owe Neo loyalty; anyone with a material conflict must proactively disclose and recuse.

Covered relationships include external project participation, investment, employment, advisory, and affiliated-entity relationships, plus any arrangements affecting independent judgment.

Anyone advancing a competing project cannot hold a governance position.

Da diagnoses Neo's current liquid voting as producing four compounding problems: low governance engagement; irresponsible or opportunistic voting with no cost to switching; proxy voting by exchanges and custodians with no governance intent; and network insecurity from a thin voting base.

He proposes replacing liquid voting with a time-locked staked voting system. Tokenholders who want to participate in governance must stake their NEO, with a 180-day un-bonding period.

GAS generation is redirected to staked voters — "those who govern, earn."

Da embeds four specific tokenholder powers in the Foundation's bylaws:

• Board nomination — tokenholders meeting a minimum staked threshold may nominate candidates; the Board must then select from a pool that includes them.
• Supervisor ratification — the Board proposes the Supervisor agency; tokenholders ratify or reject by staked vote.
• Impeachment — tokenholders may trigger a binding removal vote against any director or the Supervisor, with a supermajority threshold.
• Emergency intervention — a tokenholder vote may compel action in cases of governance failure, serious abuse, or refusal by the Foundation to fulfil its stewardship obligations.

Erik requires on-chain community authorisation for a defined list of "major matters": Foundation legal structure changes, Board and governance rule amendments, Neo Public Assets control changes, significant redistribution, brand/domain/social-media/IP arrangements, major budgets, and long-term institutional decisions.

Under §V.2, effective resolutions trigger Board execution plans within prescribed periods, overseen by the Supervisor with community status updates. Unjustified refusal, delay, or evasion of an effective resolution would be grounds for accountability, removal, or legal action.

Board candidate nominations go through individual or joint NEO-threshold mechanisms, with no preferential election rights for nominees.

Da proposes introducing NEO divisibility, noting that NEO is currently indivisible.

Three reasons are given: exchange compatibility for fractional withdrawal, more precise rebasing arithmetic for Giveback II, and finer-grained voting precision so staked voting power reflects actual holdings rather than whole-unit rounding.

A separate NIP would follow with the technical details.

Da argues that NF and NGD collectively hold 41M NEO and 40M GAS — with 33M NEO and 35M GAS under single-signature control — while total votes supporting Neo's seven consensus nodes amount to only 14M NEO.

He describes this concentration as "neither necessary nor healthy" for a Layer 1 protocol nearly ten years after mainnet, and as directly undermining "the credibility of Neo's decentralization."

In the spirit of the 2017 Giveback program, Da proposes a second redistribution of Foundation-controlled tokens to the community:

• Strategic reserve: ~5–10M NEO staked indefinitely, generating GAS as a perpetual revenue stream for NF operations.
• Community groups: ~5–10M NEO to existing sponsored communities led by leaders independent from either founder, with mandatory staking for the first four years.
• Tokenholder rebasing: ~26M NEO and ~40M GAS distributed to all tokenholders through a protocol-level rebasing.

In the interim, NF- and NGD-controlled tokens other than the strategic reserve move in tranches to a 4-of-5 multisignature "Giveback II Lock Address."

Da also proposes that the Giveback II rebasing ship as part of a single coordinated network upgrade together with Measure 3's staked voting mechanism and NEO divisibility. This avoids an interim window in which redistributed tokens would enter an unreformed liquid voting system, and reduces the operational burden on exchanges, node operators, and tooling providers that would otherwise need to adapt twice.

Erik does not propose a specific redistribution.

His §V.3 lists "Significant redistribution" among the major matters requiring prior on-chain community authorisation, under the general principle that "major Neo matters require formal on-chain community authorization followed by Foundation legal and institutional execution."

Under §V.1 such resolutions carry "highest binding effect within Foundation governance," and under §V.2 they "trigger Board execution plans within prescribed periods," with Supervisor oversight.

Any significant redistribution would therefore need community authorisation before Foundation execution.

After the initial Board is in place, ongoing Board nomination runs through tokenholders meeting a minimum staked voting threshold. The Board retains appointment authority but must select from a nominee pool that includes tokenholder-nominated candidates.

Da frames this as ensuring the community has "a meaningful voice in who governs the Foundation."

Erik proposes that all addresses holding NEO at designated snapshot times carry voting rights, open to all NEO holders without identity, regional, or off-chain restrictions.

Nominations require thresholds "ensuring seriousness and community support" — either individual nominators meeting a minimum NEO threshold, or multiple holders jointly meeting a combined threshold.

Nomination thresholds adjust based on matter significance and participation levels.

Nominees gain no preferential election rights — voters determine winners.

Da proposes two layered controls on Foundation assets.

At the structural level (Measure 2), the Board and Supervisor operate under asymmetric mutual checks — the Supervisor may review, challenge, and where necessary block Board actions, but cannot direct operations.

For the Giveback II transition (Measure 4), NF- and NGD-controlled NEO and GAS other than the strategic reserve move in tranches to a publicly-disclosed 4-of-5 multisignature Lock Address, restricted to implementation-related transfers so tokens earmarked for redistribution are visibly out of unilateral Foundation control.

Erik proposes permanent multi-party controls on all Neo Public Assets.

The rule's scope comes from the §II.7 Substantive Attribution Principle — assets are classified by beneficial ownership, control relationships, funding sources, historical use, and public service, not by formal registration name.

§III.4 specifically includes "assets held by founders/individuals in nominee, custodial, or trustee capacity for Neo's public interest."

Major transfers, custody changes, reallocation, disposition, pledges, investments, revenue distribution, or account adjustments require clear approval, responsibility boundaries, and records — regardless of whether assets are currently held by NF, NGD, in nominee arrangements, or in any other on- or off-chain form.

Erik proposes that the Foundation bear permanent duties reviewing all Neo Public Assets and historical arrangements. This covers NF- and NGD-held assets, nominee or custodial holdings by founders or affiliated entities, related on- and off-chain assets, investment interests, control structures, and historical revenue distribution.

Major historical matters would go through special review pathways for explanation, verification, attribution, and responsibility clarification.

Where past conduct potentially involves corruption, improper asset disposition, benefit transfer, public asset harm, concealment or transfer, unlawful nominee holding, governance evasion, or duty violations, the Foundation would initiate review, liquidation, accountability, and asset recovery. Listed measures include independent legal counsel and auditing, special investigations, responsibility determination, rights assertion, loss recovery, rescission of improper arrangements, removal of responsible persons, and civil, criminal, or legal proceedings.

These duties continue despite any governance, legal-entity, or responsibility restructuring — the institutional bearer of Neo's public governance retains the review and accountability duties even across reforms.

Da proposes consolidating remaining assets under the restructured Foundation to create a coherent, auditable treasury.

Cash, stablecoins, and liquid holdings transfer outright.

Illiquid positions (investments, receivables) are placed under Foundation control through binding reporting obligations, disposal restrictions, and approval rights until direct transfer is practicable.

Non-financial assets — domain names, social media, trademarks, IP, and code repositories — also move under Foundation custody.

On completion, the Foundation is the sole recognised custodian of all ecosystem assets, financial and non-financial.

Erik's proposal does not prescribe an endpoint for where ecosystem assets are held.

The §II.7 Substantive Attribution Principle classifies assets as Neo Public Assets by beneficial ownership, control, funding source, historical use, and public service — not by formal registration.

§III.4 includes "assets held by founders/individuals in nominee, custodial, or trustee capacity for Neo's public interest."

§VII.1 requires multi-party controls on all Neo Public Assets "undergoing formation, migration, restructuring, or governance incorporation" and states the rule applies "regardless of current holding arrangements — whether NF, NGD, nominee-held, or other on/off-chain forms."

The classification and control rules are written to follow the assets wherever they sit.

Da proposes that NF sustain itself entirely through GAS revenue, asset-management income, and investment returns — without reliance on liquidating NEO tokens for operating expenditure.

Objective 4 names this as eliminating reliance on NEO token sales as a funding source. Measure 5 frames it as closing a longstanding source of sell pressure on NEO and forcing the Foundation to operate within a disciplined budget rather than drawing down its token holdings.

This pairs with Measure 3's staked NEO strategic reserve (generating GAS as a perpetual revenue stream for NF operations) and Measure 5's unified funding model for all entities seeking Foundation support.

Da proposes a higher standard of financial disclosure. At minimum:

• an annual financial report covering assets, liabilities, income, expenditure, reserves, and treasury strategy;
• on-chain verification or independent attestation for large financial movements;
• open budgeting for all funding proposals, with clear disclosure of amounts, intended use, evaluation criteria, approval rationale, and follow-up on outcomes.

These standards take effect from the Foundation's first fiscal year.

Erik proposes continuous transparency mechanisms:

• periodic financial reports;
• budget and expenditure summaries;
• historical investment project explanations;
• major asset category explanations;
• control structure and responsibility boundary explanations;
• major change explanations.

Transparency is anchored twice in Erik's proposal — as one of his seven fundamental governance principles in §II.5 ("Continuous Transparency Principle"), and as an ongoing operating obligation in §VIII.1 — framing it as a permanent institutional commitment rather than a discretionary arrangement.