By Jeff John Roberts
October 19, 2017

Tezos, one of the most high-profile firms to ride the recent initial coin offering (ICO) wave, is facing its own version of “mo money, mo problems.”

Specifically, there’s a schism between the young husband-and-wife team who founded Tezos and the Swiss foundation that’s supposed to help the company build an ambitious new software platform. The fight, which follows a windfall ICO for Tezos, is currently unresolved and could delay or sidetrack the firm’s much-anticipated product launch.

If you’re unfamiliar with ICOs, they involve a company selling digital tokens which consumers can, in theory, one day redeem for access to an an online service—though, many people though also treat the tokens as a speculative investment.

The Tezos ICO, which occurred over 13 days in July, saw the firm raise $232 million in bitcoin and Ethereum—a total that today is worth considerably more given a recent surge in the value of digital currencies. (The goal of Tezos is to build a platform for decentralized applications to rival Ethereum.)

Tezos’s current troubles became public after founders, Kathleen and Arthur Breitman, asked the head of the Swiss foundation, Johann Gevers, to resign from its board. According to the Wall Street Journal:

Mr. Gevers, in an email, wrote that “the Breitmans have attempted to bypass the Swiss legal structure and take over control of the foundation, and have acted destructively, causing months of delays in the Tezos project.”

He has alleged the Breitmans’ involvement in his work “was incompatible with the needed independence of the foundation,” according to a separate letter from a Breitman lawyer, which referenced a Sept. 21 meeting at which Mr. Gevers made the claim.

The delays cited by Gevers relate in part to the release of the tokens, known as “tezzies,” that Tezos has promised to release as part of the project. The futures market for the tokens has reportedly dropped by 75% since news of the infighting broke.

In a phone call with Fortune, Kathleen Breitman said the company still plans to release the tezzies, which she anticipates distributing by February. In an emailed statement, she also shot back at Gevers, questioning his competence and alleged he tried to arrange a $1.5 million bonus for himself:

[He] has acted as a roadblock to the mission of the Foundation—to launch the Tezos network and support the Tezos ecosystem. Johann consistently failed to meet deadlines, was unwilling to hold or attend council meetings, and failed to hire employees to help launch the network or pay people he committed to paying, and was constantly unavailable to handle foundation matters…

ohann attempted to pressure the other members of the foundation council to award him a contract that would, among other things, grant himself a bonus worth $1.5 million at then-current valuation of the Tezos token. He misrepresented this as being worth only $300,000. After Arthur and Kathleen brought this behavior and a number of other issues to the attention of the council, the Tezos Foundation suspended Johann from his operational role.

Part of the tensions appear to be rooted in part in Tezos’s unusual legal structure, which involves the foundation paying to acquire a company controlled by the Breitmans, and then spending the bulk of the ICO money to develop and promulgate the platform.

This arrangement has led some to question whether Tezos’s plans fit within the bounds of the Swiss legal system’s conception of a foundation.

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Meanwhile, Reuters describes uncertainty over whether the contribution that Tezos collected during its ICO. Specifically, it’s unclear whether they amount to “donations” for a software project or if they are instead akin to an early share purchase that the buyer hopes to redeem in the same way as a speculative investment.

All of this comes at a time when the SEC and regulators around the world are scrutinizing ICOs, and creating guidelines for when a token sale is legitimate and when it amounts to an illegal sale of securities.

This is part of Fortune’s new initiative, The Ledger, a trusted news source at the intersection of tech and finance. For more on The Ledger, click here.

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