Author: Wu said blockchain
On March 7, TON ecosystem project Yescoin tweeted that Yescoin founder and Zhejiang University alumnus Zhang Chi (Zoroo) was taken away from Hangzhou by Shanghai police due to a business dispute with partner Wang Mouxin (Lao Wang), and the case has been upgraded to a criminal case. The Yescoin team said that the product is still operating normally and thanked the community for its concern for Zhang Chi.
Wang Mouxin, the partner mentioned in the Yescoin official tweet, published a long word article stating that Zhang Chi has no actual investment relationship with 3WW3 or any other project; from February when the Yescoin project was launched to early June, Zhang Chi did not participate in any work, and his core energy was devoted to his own Tonverse project; in July, Zhang Chi participated in the planning and launching of an illegal robbery incident, illegally deprived the founder Wang Mouxin of his authority, and illegally instigated members to control the project; on October 31, he conspired on Lark to obtain the check-in-related code information for the online core income, preparing to illegally rob the online income.
The Yescoin Hangzhou Zhang Chi team denied that the project belonged to Wang Mouxin, believing that the team itself had contributed more and that no plan had been reached on the distribution of profits. In the end, all members agreed to kick Wang out.
Full text of Wang Mouxin’s self-defense:
https://docs.google.com/document/d/1IkVP2CiCrVMQYyBjg5ATutTwZMj5VIt1B0DQ6Lvowg0/edit?usp=sharing
Yescoin Hangzhou team responded in an interview:
Colin: Who are the founding team of Yescoin?
Eric et al.: I was the only person in charge of brand design and marketing design, and I was one of the earliest members to participate in this project. From the beginning to the beginning, the only information I received about this project was its name, Yescoin. After that, all the visual elements, including color selection, style setting (such as pixel style), modeling design, and brand tone, were completed independently by me.
During this process, no one reviewed my design. All creative ideas and visual expressions were determined and presented directly by me. Therefore, there is no so-called "other people" or "someone" to complete this entire set of construction. I can provide process records of all design outputs to prove this. In addition, this project was originally incubated by 3WW3, and I was also an early member of 3WW3.
Let's talk about the execution of the project first. From a personnel perspective, the earliest core team had a total of 7 people, including a product manager, two back-end developers, two front-end developers, an operation, and brand design. Among them, the front-end, back-end and product manager were found by Lao Wang through outsourcing, and they were external manpower directly recruited by him. The remaining four people, namely the core front-end development, back-end development, operation and design, were all recruited by Chi Ge through the 3WW3 system in 2023. This was the basic composition of the team at the time, and it was these 7 people who jointly completed the core construction of the project.
Therefore, Lao Wang said "he did it" and we said "we did it". Strictly speaking, it should be completed by the members of 3WW3. Because there was no clear concept of the company entity at that time, everyone promoted the project based on their contribution and ability.
Now let's talk about the funding issue. If you want to know who paid for it, I can tell you clearly that the funds mainly came from 3WW3, because there are two aspects involved. First, when Mr. Tang, I and other members of 3WW3 (including Zhang Chi) joined the project, we actually participated in it in the form of "human cost" as an investment. In other words, we did not receive a salary, but our daily work and labor were essentially equity investment in the project.
During this process, since the project had no actual output at that time, we could not discuss the valuation or confirmation of ownership. But from the actual situation, our contribution is not just physical labor, but the creation of real project value. So even if these investments are not cash, they are still real investments.
Colin: As Lao Wang said, all the money from start to finish was paid by Lao Wang?
Eric and others: We used financing funds. Another part of the funds came from another investor, but I am not comfortable revealing his name. It was not just Lao Wang who invested, Eric also invested, and even we personally invested money in it. Although some living expenses were reimbursed, we sometimes did not care about many business expenses and just spent what we should spend. Of course, compared with the bulk of the funds, these amounts are not large. Eric spent about 400,000 yuan in total. If necessary, we can communicate and see if these records can be displayed.
Colin: How much money do you think Lao Wang actually spent, including the Asia-Africa Institute and Yescoin?
Eric: 0. I can clearly say it is 0. We have previously collected data from Zhang Chi, and there is relevant evidence that directly shows that although Lao Wang has invested funds, he specifically noted the word "loan" in the investment record. Moreover, when he communicated with our previous member in charge of financing, he specifically emphasized that once the subsequent financing funds arrived, his 1.6 million RMB loan would be repaid first.
Throughout 2022 and 2023, 3WW3, as the main body, we received a total of 1.42 million US dollars in financing, which is the actual amount received. This money was mainly invested by individual investors. Known investors include Dashan of Waterdrop Capital, and most of the funds come from individual investors. After July 11, we officially separated from Lao Wang. After that, Zhang Chi took over all debts in his personal name, communicated with all investors one by one, and signed an agreement clearly stating that Zhang Chi would bear the responsibility for the funds invested by all investors.
Colin: Whether it is Yescoin or 3WW3, does this project have an equity structure? Or a formal company entity? Are there any relevant legal documents?
Eric et al.: The reason why we had such a fierce dispute was that from the beginning, this project never established a formal main structure. It was only when Chi Ge realized the necessity of this matter that various conflicts and disputes began to arise.
When we first joined the project, perhaps out of pure or naive thinking, everyone cooperated based on verbal commitments. Everyone was told that they were "partners", but the specific equity arrangements and legal agreements were never implemented. The initial idea was to get things done first and discuss these issues after the results were achieved. However, after the things were done, Lao Wang began to talk about "separation" or simply screened out certain people and excluded the core members. In other words, after the project really developed, he tried to control everything unilaterally.
Colin: So, all cooperation agreements and financing contracts were ultimately signed with Lao Wang’s company, right?
Eric et al.: We don’t know exactly with whom he signed the contract. We really don’t know about this question because he was in charge of many things himself and the specific details of the contract were never disclosed to us.
Colin: How can there be investment without a formal contract? Whether it is institutional investment or individual investment, this level of capital flow must be supported by a contract.
Eric et al.: We are not clear about the specific investment contract. You can understand it this way: Lao Wang wants to control all matters related to "collecting money" and we are the ones who execute all the "work".
Colin: So for all this time, you haven't asked him to give everyone a formal equity distribution plan?
Lao Tang: Of course this request has been raised.
Colin: In other words, when did you formally put forward clear equity demands?
Lao Tang: In June, we formally put forward the request to him. But before that, since the project had not yet generated actual benefits, no one cared too much about these things, and the team as a whole was relatively united.
Colin: Because there was no actual interest involved, right? So there were not many disputes at that time.
Lao Tang: Yes, the problem is that in May, the project started to produce some good results, and we officially started discussing equity distribution and dividends. But even so, we did not make excessive demands, but just tried to communicate and hoped to reach a reasonable solution. Moreover, we have talked to him three times, but each time his attitude was perfunctory, constantly making promises and promising to solve the problem "in a few months". I have a recording here to prove his statement.
However, when the time he promised came, he not only did not fulfill his promise, but instead began to look for a new team, trying to transfer the project's resources and funds to them, leaving us to "find jobs on our own." That's why on July 11, all of us unanimously agreed to remove Lao Wang from the management, while still retaining his corresponding rights and interests.
I personally think that we did not go too far in this matter. Lao Wang is not suitable to lead this team, and he cannot give real value to the project in management. His behavior has seriously damaged the interests of the team. Therefore, on July 11, all members of 3WW3 unanimously agreed to remove him.
Colin: So there are still two questions now. The first one is that Lao Wang questioned that you have actually made a lot of money through the traffic diversion of this Bot. Is this true?
Eric: Yes, objectively speaking, the peak of project traffic was from May to November last year. During this period, the entire Telegram ecosystem was the hottest, and everyone knows this. During this period, all commercial behaviors and commercial decisions, including our traffic diversion transactions with partners, we estimate that the total revenue is between 2 and 3 million US dollars. But all these business revenues are in the hands of Lao Wang personally, not on our side.
Since we officially took over the project on November 7, our business income has mainly come from the exchange and slow-volume models in the three months from November to December this year. Even if there is income, we will reinvest most of the funds into project development.
Colin: How much revenue did you generate during this period? And what were the costs?
Eric: The total revenue is about 400,000 to 500,000 US dollars.
Colin: Got it. Another question is about the coin issuance, right? You actually missed a good opportunity to issue coins. Is the main reason for the difficult situation now because of this internal struggle?
Lao Tang: From my point of view, the main reason is the wrong decision. The best market opportunity was in May, when everyone was desperately pushing forward the project, but the real internal conflict broke out after July 11.
Colin: I see. So after July 11, your Hangzhou team took over the project, and Lao Wang may have tried every possible way, whether it was filing a case, calling the police, or suing, etc., right?
Lao Tang: No. He sacrificed the opportunity to issue coins, and then deliberately set up various company entities, and even claimed that he owned intellectual property rights. In fact, his purpose was to target us, not for the project or users. He never really cared about the development of the project, and never understood the actual needs of users. He may not even know the basic profile of users, let alone really contact and understand them. It is us who have been communicating with users on the front line, analyzing their needs, and knowing how to attract them.
Colin: But from the perspective of law and equity, these questions you raise may not make much sense. For example, if Musk invests in a company and is the majority shareholder of the company, then no matter how hard the employees work, the company will eventually belong to Musk.
Lao Tang: Yes, but the situation here is different. The employees invested by Musk have formal contracts, but we have not received any salary since the first day of the project. Instead, we participate as partners. It’s just that in the actual operation, we bear greater responsibilities and everyone’s division of labor is different.
From the very beginning, we did not define team members according to the traditional employment relationship, but rather we worked together as partners to move this project forward.
Colin: So between the time you officially took over the project and the recent outbreak, have similar situations occurred many times? Or has it been relatively stable overall?
Lao Tang: It has happened many times. This is also a point I want to emphasize. For example, the communication software we used in the past was Lark, and then the management rights of Lark were inexplicably taken away by some "mysterious force".
Not only did the other party take away Lark permissions, we even received an email notification showing that our email login permissions had been modified. This means that they can log in to the system with our account and even publish information. Therefore, a lot of information was taken out of context or tampered with, and we also lost some historical records, resulting in some key details that can no longer be verified. At that time, we realized that the team had been artificially divided and some core resources had been artificially cut off.
Colin: I understand. This is actually normal. Regarding the so-called equity and control rights, Lao Wang may continue to file complaints, including using various legal means to try to regain control. The dispute over the rights of tools such as Lark is also a common situation in this type of dispute.
Lao Tang: Yes, we have been focusing on the project itself, but he has been doing small things behind the scenes, trying to target us. And I think he may have started planning all this more than half a year ago.
Colin: I see. So what is your plan for dealing with this situation? Have you communicated with lawyers and the police?
Lao Tang: Yes, we have taken legal action to deal with it.
Colin: And now the main authority of the project has been taken away by him, right?
Old Tang: That’s not entirely true. The main body is still on our side. This is essentially a civil dispute. But the problem is that for some reason, this matter was escalated into a criminal case by “some force”. This is the most strange thing.
Colin: I mean, has the management rights of the Bot and the permissions of the Telegram channel been taken away from him?
Lao Tang: We still have some control over Bot permissions and channel permissions, but now there is a “hard fork” situation.
Colin: OK, I heard before that in February, Eric said that Lao Wang used his relationship with the TON Foundation in some way to transfer the authority of the main channel?
Eric: Yes, that’s right. The permissions of the main channel were transferred away by him.
Lao Tang: However, after the main channel was taken away by him, we also re-established a new traffic channel and retained the new Bot permissions.
Colin: So are users staying in the original channel or moving to the new channel?
Lao Tang: There are both sides, which is equivalent to having two versions of the Yescoin community, the real one and the fake one.
Colin: So, this matter seems complicated, but it is not that complicated in essence. In the final analysis, it is because you did not have a clear contract and equity structure when you first started your business that led to these disputes. In the end, everyone has their own opinions and positions.
Lao Tang: Yes, and the most bizarre thing is that this should have been an ordinary equity dispute, but somehow it was forcibly upgraded to a criminal case. Moreover, this project was built from scratch, and the entire 3WW3 has been developed in Hangzhou for nearly two years, but now it has been transferred to Shanghai. This is really incomprehensible.
Colin: In fact, this situation is also very common in the Web3 industry, such as Binance. When Binance first started, it gave tokens to many consultants and investors, but later when the company grew bigger, Binance no longer recognized these early promises. Because when the company grows into a 100 billion-level enterprise, they may not be willing to fulfill the early tens of millions of dollars in investment or commitments.
Lao Tang: This may be the case in business, but we still think that there should be some idealism in the Web3 industry. Decentralized organizations should be jointly promoted by a group of like-minded people, rather than letting capital control everything. This is also where we were relatively simple at the beginning. Looking back now, perhaps this is "bad money drives out good money", and young people with ideals will only suffer in the end.
Colin: We can’t say that idealism represents everything. Indeed, it is difficult to reach a conclusion on such matters, and it is also difficult to say who is right and who is wrong. But from your experience, this has also sounded a wake-up call to other entrepreneurs - entrepreneurs in the Web3 field need to have legal awareness, equity awareness, and contract awareness, otherwise similar problems will easily arise when the project grows.
Lao Tang: Yes, this is also part of our reflection.
Colin: So, this means that all members of the Hangzhou team did not sign any contracts or participate in any company's equity structure during the entire process?
Eric: Yes, that’s right.
Lao Tang: It was not until the project was transferred to Shanghai that they began to supplement these structures, and the people who were added were basically members of Lao Wang's original team. He introduced his team to us at the beginning, saying that they were outsourced personnel. Later, he took his outsourced team to Shanghai and found a new outsourced team in Shanghai. At that time, he also told us that this was just a temporary adjustment and he would return to Hangzhou later. We also have relevant video records at that time.
At that stage, we were still discussing the incentive plan, and there was a certain degree of trust between each other. Zhang Chi took the lead in helping us to advance this matter. But in July, we clearly reached an agreement that all authority would be in charge of Zhang Chi, who would act as an agent to negotiate the final incentive plan. Until November, the incentive plan was not negotiated, and as a result, Lao Wang’s side directly isolated us completely. In order to protect our own rights and interests, we could only control the core account of the project in our own hands to ensure that our work results would not be encroached upon.
Colin: Why didn't they reach a compromise in the end? After all, it's a lose-lose situation for everyone.
Lao Tang: The specific reasons are probably only known to Lao Wang and Zhang Chi. They have communicated with each other many times, but have never reached an agreement. Of course, I can only evaluate Lao Wang from a personal standpoint. I think he is very good at acting. Zhang Chi has communicated with him more, and Zhang Chi's feedback is that Lao Wang is very selfish and greedy. For example, during their negotiations, Lao Wang once asked the team to give up almost 80% of the profits. This distribution plan will not leave a reasonable profit space for the team at all. To put it bluntly, the treatment is worse than going to work directly.
Lao Wang, one of the founders of Yescoin, responded in an interview:
I first met Zhang Chi in July or August 2022. At that time, I had an idea to build a community similar to DAO.
Zhang Chi's early core role was mainly HR, helping to see if there were suitable partners to introduce to the community and establish connections. Zhang Chi himself had worked in the community before and knew a lot of people, so in this process, his role was more towards community operations, helping to recommend suitable talents.
The community did not initially involve the market, products, or business, but only produced some content, such as some public account articles. Throughout 2023, the industry was still in a bear market. By the end of 2023, the Bitcoin ecosystem began to heat up, and the community atmosphere also changed. At this time, the flow of people in the community began to increase. Although people came and went, some fixed partners stayed and were willing to try some business activities based on the community.
At that time, my personal commitment was that I would be responsible for reimbursing all food and accommodation, and if anyone had some product ideas, I could also provide early support.
By 2024, the market began to pick up, and everyone had their own ideas about cryptocurrency or other aspects. In this process, early team members gradually began to do their own things.
But at the same time, some differences in values began to emerge within the community, which was harmful to the community. The community itself is not a company, it does not have a strict management mechanism, and members cannot be fired at will, so I can only maintain a certain balance in it.
As more and more people join the community, it begins to decentralize, gradually forming small groups and factions, each of which sets up its own project. In the same period, multiple different projects can be seen running in the community at the same time.
In the initial stage, the funding support of these projects mainly relied on the community reimbursement mechanism. Later, some projects also began to receive independent investment. However, it is not easy to incubate projects in the community. The decentralized management model makes overall planning difficult, resulting in reduced efficiency.
In the later period, the community's reimbursement costs became higher and higher. What impressed me most was that at the peak, the monthly reimbursement amount could reach hundreds of thousands of RMB.
In this process, it is inevitable that the phenomenon of "not scarcity but inequality" will occur, and even the situation of "bad money driving out good money" will occur. Because some people have the power to spend funds in the community, and some people have the resources of the project, some contradictions will inevitably arise internally.
In the later community development process of Yescoin, everyone did their own thing. But the specific project of Yescoin was initiated by me, a partner who I have worked with for 9 years, and an external partner. Around mid-February 2024, my partner and I began to discuss this direction, and the project name was determined around February 28.
From March to May, Yescoin grew very fast. But there was a key time point - the progress of financing. The progress of financing may not be that fast, and I was always on the front line to promote products, operations and matchmaking. From all the work records, these things were mainly led by me.
Secondly, as the community influence continued to expand and the project grew exponentially, funds were extremely tight. The team needed to be expanded, but the number of initial core members was insufficient, so we were frantically recruiting people. However, in this process, due to the rapid growth, the authority management of some personnel became relatively extensive, which laid the hidden dangers of subsequent problems.
In the case of the Institute of Asian, African and Latin American Studies, my personal expenditure was over 4 million RMB. Yescoin spent a total of over 1 million USD. I prefer to pay directly, and I was indeed negligent in terms of account management. So, initially Eric controlled some accounts, a certain developer controlled some accounts, and another developer in our company also controlled some accounts.
Then, around May and June, they began to adjust the permission configuration and gradually centralized the account management in the Hangzhou team. To put it bluntly, it was because after Notcoin went public, the atmosphere in the community started to become strange. Before, no one would actively approach Yescoin, but at that time, the project received a lot of attention, and everyone started to scramble for resources and pick problems.
After July, they should have "rehearsed" several times, and then directly announced that the account belonged to them. At that time, I was on a business trip, and they took advantage of this time to cut off all the permissions. This happened very suddenly, and I was completely unprepared. When I came back, I found that the control of all accounts was no longer in my hands. I was very passive at the time and could only try to solve the problem. The information gap between the two sides also caused conflicts. On the one hand, the Hangzhou team has been saying that there is not enough money. On the other hand, from my work records, they have long been using account permissions to secretly divert traffic and transfer resources. In short, the account was indeed in the hands of employees in the early days, but later, the Hangzhou team gradually used various means to completely control the permissions in their own hands.
A member of the Shanghai team had authority at the time. However, when he arrived at the Hangzhou community, he was influenced and perhaps brainwashed. The Hangzhou team emphasized the concepts of "decentralization" and "freedom" and some interests, and he was influenced by this concept and handed over his authority to the Hangzhou team.
In fact, the most core authority and the most critical part at that time were the Bot accounts, which were originally designed and managed by the Shanghai team. Later, the Hangzhou team gradually expanded its authority on this basis, began to take over more project resources, and also launched new channels. From the overall situation, some members of the Shanghai team were indeed affected at that time, and later we found that there was a complete series of evidence to prove how the authority was gradually transferred.
I have the financing terms, business contracts, and a series of related documents. All the company's corresponding equity certificates, including my personal investment records, are in these materials. I am fully aware of my rights.
Theoretically, there may be some options or equity among the early team members. But the problem is that the matter had not been formally negotiated at the time, and Zhang Chi had not officially entered the shareholder structure, so there was no way to talk about it. At the time, Zhang Chi and his team were not on the list of shareholders at all. Eric was actually only responsible for community operations in the early days, and there was another person in charge of design. Therefore, it was impossible for me to sign an equity agreement when everyone joined the company, because this would only magnify the conflicts. Our original intention was to have two or four people make the core decision, but in fact, the team had grown to more than a dozen people at the time, and the situation became more complicated.
To be honest, everyone was very excited to work on this project, and I also felt that this thing could develop in the long run, so in the process, I always hoped to make it more sustainable. However, in July, some people were already secretly selling traffic and cooperating with external forces privately. When they realized that things might not be able to be covered up, they took advantage of this time to completely take away the account permissions.
At that time, Zhang Chi came out to negotiate with me, but he had more information than I did, and he used some issues within the team to negotiate with me. In fact, I was discussing equity distribution and salary structure with the team, but in the end, they wanted to take the entire project away.
