Binance Founder CZ-Backed YZi Labs Accuses CEA Industries of Shareholder-Hostile Tactics

YZi Labs, a major shareholder in CEA Industries Inc. (NASDAQ: BNC), has accused the company's board of adopting anti-shareholder measures to entrench control. The firm criticized the recent implementation of a poison pill and bylaw changes, calling them stockholder-unfriendly.

The dispute escalated as YZi Labs launched a written consent solicitation to restructure the board and align the company's strategy with its BNB-based treasury plan. CEA responded by implementing a shareholder rights plan and delaying the 2025 annual meeting beyond its December 17 anniversary.

YZi Labs has raised concerns over CEO David Namdar's public comments suggesting a potential pivot to other crypto assets like Solana. The firm also highlighted conflicts of interest involving Namdar and board member Hans Thomas.

Why Did This Happen?

YZi Labs argues that CEA's actions are a strategic and procedural overreach, prioritizing board entrenchment over shareholder interests. The firm filed a preliminary consent statement with the SEC, seeking to expand the board.

CEA Industries, which transitioned from vape manufacturing to a BNB-focused treasury firm in mid-2025, has faced shareholder unrest after its stock price dropped nearly 90% from its peak. YZi Labs claims the company failed to meet expectations set during the $500 million private placement.

What Are Analysts Watching Next?

Market observers are monitoring the delayed 2025 annual meeting as a key battleground for shareholder influence and board control. The conflict highlights broader tensions in crypto-linked public companies, where governance and strategic direction often become contentious issues.

YZi Labs has urged CEA to maintain transparency and avoid further manipulative behavior regarding director nominations and meeting scheduling. The firm also called for a 'free and fair' election process.

The outcome of this dispute could reshape CEA Industries' leadership and influence its focus on BNB-based assets. Investors and analysts are watching to see whether other shareholders will align with YZi Labs' efforts or support the current board.