TL;DR

YZi Labs, linked to CZ, files an SEC consent solicitation to replace CEA Industries’ board.
The conflict centers on CEA’s management of its large BNB corporate treasury.
YZi Labs accuses current leadership of governance failures and conflicts of interest.

U.S.-listed CEA Industries Inc. (NASDAQ: BNC), which only months ago was introduced as the largest BNB corporate treasury in the country, now faces a major governance challenge led by YZi Labs, a firm linked to Changpeng “CZ” Zhao. The dispute moves into the regulatory sphere after YZi Labs filed a comprehensive consent solicitation with the U.S. Securities and Exchange Commission (SEC) seeking to reshape the company’s board and overturn recent bylaw changes.

According to the filing, YZi Labs is asking BNC shareholders to approve an expansion of the board of directors, repeal any amendments adopted after July, and elect a new slate of directors proposed by the firm. 

The submission includes a white consent card that allows investors to formally express support or opposition to each measure. If a majority of outstanding shares approve the proposals, YZi Labs gains the authority to reconstitute the board through written consent without calling a shareholder meeting.

The company connected to CZ holds about 5% of BNC’s shares and argues that the current board has failed to uphold basic corporate governance standards. The filing accuses leadership of delaying disclosures, neglecting key actions, and maintaining poor communication with investors. YZi Labs stated that BNC shareholders “deserve a functioning board” and warned that inaction will result in further shareholder value erosion.

The conflict has been building for months, fueled by requests for transparency and questions over management accountability. Tensions escalated following the $500 million PIPE financing in August, which financed the firm’s transformation into a BNB-centered digital asset treasury.

Market reaction was initially explosive — BNC shares surged more than 600% in July — but the rally reversed as the stock later fell over 92%, recently trading near $6.47. Meanwhile, BNB itself peaked above $1,300 in October before retreating toward $820.

CEA Industries’ latest disclosure shows a net asset value (NAV) of $8.09 per share, leaving the stock trading at roughly 0.8× its NAV. YZi Labs points to the discount as clear evidence of investor mistrust and board underperformance.

Operational and Leadership Issues Cited in Filing

The SEC submission lists several operational lapses, including delayed registration filings for an at-the-market offering, a lack of investor updates, and an unfinished investor relations website months after the PIPE. The filing also notes the absence of regular reports on net asset value, BNB yield, or accumulation rate, all core data points for a digital asset treasury vehicle.

Further confusion surrounds the company’s brand identity. According to the document, CEA Industries alternates between using “CEA Industries” and “BNB Network Company” in its communications without clear guidance, leaving investors uncertain about the corporate structure and strategic direction.

YZi Labs also raises conflict-of-interest concerns within the leadership team. CEO David Namdar, director Hans Thomas, and former 10X Capital executive Russell Read all maintain connections to 10X Capital, the firm managing BNC’s crypto treasury.

The filing alleges that Namdar and Thomas engaged in discussions promoting other digital asset ventures while leading BNC, casting doubt on their independence and commitment to shareholder interests.

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Filed under: News - @ December 2, 2025 4:17 pm