YZi Labs has intensified its public battle with CEA Industries Inc., the corporate parent of BNB-focused investment vehicle BNC, by alleging that a recently departed director was not independent because of prior ties to asset manager 10X Capital.
At a Glance
- YZi Labs cites SEC filings showing ex-director Russell Read was Vice Chairman of 10X Capital
- The firm says the 20-year fee agreement with 10X deepens potential conflicts of interest
- YZi Labs wants to expand BNC’s board and install its own nominees, including ex-Senator Max Baucus
- Why it matters: The outcome could determine whether BNC stays tied to the BNB Chain or pivots to other digital assets
The venture capital firm, which owns 2,150,481 shares of common stock plus additional warrants, released its latest statement on X, declaring that “transparency is non-negotiable” and highlighting what it calls undisclosed links between Russell Read and 10X Capital.
Former Director’s Independence Questioned
Russell Read stepped down from the CEA Industries board on December 30, 2025. In an 8-K filing that day, the company labeled the group from which Read resigned as “independent” and said his departure followed acceptance of a new role requiring him to leave external boards. The filing also carried a statement from Read praising the entity for its “diligent and independent oversight.”
YZi Labs countered by pointing to the same SEC disclosures, noting Read had previously served as Vice Chairman of 10X Capital. The firm argues this relationship undercuts assertions of board independence and raises questions about oversight quality.
20-Year Fee Agreement Under Scrutiny
Beyond Read’s former role, YZi Labs flagged a 20-year agreement it says 10X Capital structured. The terms allegedly allow the asset manager to keep collecting fees even after termination, terms YZi Labs contends deepen potential conflicts and deserve closer shareholder scrutiny.
Strategic Direction at Stake
The governance clash centers on BNC’s future focus. Investors including YZi Labs backed the vehicle for its BNB Chain-related treasury strategies. Recent internal discussions have hinted at a possible pivot toward other digital assets, causing unease among some shareholders. Public comments from BNC’s CEO in November 2025 about considering assets like Solana are cited by YZi Labs as evidence of strategic drift.
Push for Board Expansion
YZi Labs has filed a formal consent statement seeking to expand BNC’s board and seat its own nominees. The proposed slate includes:
- Former U.S. Senator Max Baucus
- Blockchain figure Matthew Roszak
The firm maintains its goal is to protect shareholder rights and uphold the integrity of the BNB ecosystem it believes BNC was built to support. The outcome will test shareholder activism in crypto-corporate governance and could decide whether BNC remains tethered to the BNB Chain or charts a new course.
According to News Of Losangeles‘s earlier reporting, tensions have been building since investors noticed signs of a strategic shift away from BNB-centric investments. YZi Labs says it remains “committed to protecting BNC shareholder rights and upholding the integrity of the BNB ecosystem.”
The dispute now moves toward a shareholder vote that could reshape the boardroom and, by extension, BNC’s investment mandate.
