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YZi Labs, an investment vehicle linked to Binance founder Changpeng Zhao, filed Monday to take control of CEA Industries’ board, escalating a power struggle over the struggling firm’s plan to build the world’s largest BNB treasury amid an 89% stock collapse since its crypto pivot.
The takeover bid centers on who will direct the BNB-driven transformation of CEA, with YZi proposing to cancel recent bylaw amendments, expand the board, and install its own nominees. If successful, the move would give the Zhao-linked entity decisive authority within the BNB Treasury Firm, which has faced deep market turbulence since its crypto pivot.
YZi Labs’ filing outlines a plan to reset the governance structure of the BNB Treasury Firm, arguing that new oversight is necessary to prevent further erosion of shareholder confidence. The firm said its proposals would reverse all bylaw changes enacted since July, widen the number of board seats, and bring in a new slate of directors chosen by YZi.
YZi maintains that these changes are essential to realigning the company with its intended direction. According to the filing, immediate intervention is needed to halt what YZi calls the “ongoing destruction of stockholder value.”
If shareholders approve the actions, YZi would gain substantial influence over the BNB Treasury Firm, positioning it to steer the company’s multi-hundred-million-dollar BNB acquisition strategy and its transformation into a major treasury vehicle.
With the firm’s identity increasingly tied to its crypto ambitions, governance has become a decisive battleground for the future of the BNB Treasury Firm.
CEA’s stock performance has added urgency to the governance fight. The company—formerly known as a Canadian vape manufacturer—saw its shares skyrocket 550% on July 28 after announcing plans to reposition itself as a BNB Treasury Firm. The price reached a peak of $57.59 amid investor enthusiasm for its pivot into BNB accumulation.
But the surge proved short-lived. As of Monday, the stock has plunged roughly 89% to $6.47, falling more than 20% this year alone and slipping below its pre-pivot valuation.
Part of the initial excitement stemmed from a proposed $500 million PIPE investment, which included participation from YZi Labs. That pivot also brought on 10X Capital’s David Namdar as CEO and added several 10X executives to the board. In October, YZi Labs publicly announced its support for 10X Capital’s creation of the BNB Treasury Company, a parallel initiative with similar ambitions to the BNB Treasury Firm.
The collapse has left many investors questioning whether the management team can deliver on its vision. With CEA’s valuation devastated, concerns over leadership continuity and transparency have become central to the debate around the BNB Treasury Firm.
YZi Labs’ filing also sharply criticizes the company’s current leadership, focusing particularly on CEO David Namdar. YZi argues that investor communications have been slow and that the marketing of the BNB Treasury Firm has been insufficient at a time when clarity and visibility are critical.
The filing claims Namdar lacks “devotion and loyalty” to CEA, alleging that he has publicly promoted other projects tied to cryptocurrency treasury strategies. YZi contends that such actions are incompatible with stewarding the BNB Treasury Firm, particularly during a period of heightened scrutiny and financial instability.
YZi further suggests that after restructuring the board, the company should consider whether a leadership change at the CEO level is necessary to safeguard the future of the BNB Treasury Firm.
With the company’s BNB plans at stake, the challenge underscores a fundamental disagreement over how the firm should communicate, operate, and position itself within the digital-asset ecosystem.
