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Storj files for Chapter 11 bankruptcy, plans equity pathway for STORJ
Storj said it will keep its network running and customer services operating during the Chapter 11 process, while it seeks a court approved mechanism for tokenholders to participate in any reorganized equity.
Storj Labs has filed for Chapter 11 bankruptcy protection in the US Bankruptcy Court for the Northern District of West Virginia, saying it plans to keep its decentralized storage network operating during the restructuring. According to Cointelegraph, the company said ordinary operations and customer services would continue, subject to court oversight, with its parent company Inveniam continuing to support the business.
Storj said it is exploring an ownership pathway for STORJ tokenholders as part of its Chapter 11 process. In an open letter to its community, the company said its liabilities largely predate its current strategy and cannot be resolved through business growth alone, while also stating the network continues to operate normally and the token’s utility is unchanged.
The company said management intends to propose a mechanism allowing tokenholders to participate in the equity of the reorganized company, but it did not disclose how eligibility would be determined, whether participation would use a token snapshot or lockup, or how much equity might be allocated. Cointelegraph also reported Storj acknowledged any plan must follow bankruptcy priorities and receive court approval, and noted it saw no significant immediate price reaction, with STORJ trading around $0.072 at the time of writing per CoinGecko.