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Storj Labs files for Chapter 11, seeking equity for token holders
The firm said its decentralized storage network will keep running normally during the U.S. court process while it develops a plan for token holders to participate in the restructured company’s equity.
Storj Labs, the company behind the decentralized cloud storage network Storj, has filed for voluntary Chapter 11 bankruptcy protection in U.S. Bankruptcy Court for the Northern District of West Virginia, according to The Defiant.
Storj said the filing is intended to address legacy obligations while preserving ongoing operations. It added that it will continue operating in the ordinary course throughout the process and does not anticipate interruptions in service to customers, subject to court oversight, while parent company Inveniam continues to support the business and endorses the reorganization.
In a separate open letter to its token community, Storj said it intends to propose a mechanism for token holders to participate in the equity of the restructured company as part of its plan of reorganization. The company said the design, including eligibility, mechanics, and terms, will be developed during the case and disclosed formally, and it emphasized that any plan must be approved through the court process and that bankruptcy law sets priorities among stakeholders.
The token, STORJ, traded around $0.0608, down about 18.1% over the prior 24 hours, and carried a market capitalization of roughly $26 million, based on CoinGecko data cited by The Defiant. The company said the network continues to operate normally, token utility is unchanged, and it is not offering or soliciting any security or token, nor promising recovery.