TL;DR
- YZi Labs, Changpeng Zhao’s family office, accuses 10X Capital of mismanaging CEA Industries’ (BNC) treasury, compromising asset transparency and potentially breaching strategic agreements.
- The notice triggered a 0.7% drop in BNC stock and a 1% decline in BNB price.
- YZi Labs calls for changes in CEA Industries’ board and the implementation of a public DAT dashboard to provide clear insights into treasury operations and risk management.
Changpeng Zhao’s family office, YZi Labs, sent a formal notice to 10X Capital Asset Management raising concerns over treasury mismanagement at CEA Industries (BNC). The alert highlights issues in transparency and potential violations of the strategic services agreement, generating investor concern and market attention in the BNB ecosystem. Analysts note that increased scrutiny of BNC may influence other treasury management firms, particularly those handling large-scale crypto assets with complex investment pipelines.
YZi Labs Highlights Treasury Mismanagement Concerns
The notice claims that 10X Capital and BNC management planned to shift funds from BNB to Solana using a $500 million PIPE investment, in conflict with the original BNB treasury strategy. YZi Labs requests written confirmation by December 5 that 10X Capital will adhere to the BNB treasury plan. It also demands detailed reporting of BNC assets, including BNB holdings, share counts, and mNAV, via a public DAT dashboard to improve transparency and shareholder oversight. The notice emphasizes that continued lack of clarity could lead to regulatory attention and further reputational risk.
According to the notice, prior decisions by 10X Capital have already caused documented losses to investors. The firm also cites a lack of clarity on BNC’s digital asset treasury operations and risks, intensifying the urgency for corrective measures. Market observers suggest that YZi Labs’ action may set a precedent for how family offices monitor third-party managers in large crypto treasuries.
BNC Stock Reacts and Market Implications
Following the announcement, BNC stock fell 0.7% in pre-market trading, while BNB price pulled back nearly 1%. CEA Industries currently holds 515,054 BNB valued at $462 million, with an mNAV of 0.80x. Derivatives markets show recent selling pressure, with BNB futures open interest dropping 1.15% to $1.50 billion, while 24-hour trading volume rose 36%, reflecting sustained interest among traders.
GA Capital analysts noted strong support for BNB above $824 and indicated that breaking resistance at $906 could trigger notable upside momentum. YZi Labs recommends board changes and public disclosure of the DAT dashboard to restore investor confidence and ensure adherence to BNB treasury strategy. Market participants are now closely monitoring CEA Industries’ response and potential adjustments to its investment strategy.
