Storj Files for Chapter 11 Bankruptcy as STORJ Token Falls 17.7%

Storj Labs has filed for Chapter 11 bankruptcy protection in the United States as it seeks to restructure legacy debt while continuing normal operations. Following the announcement, the STORJ token fell approximately 17.7%, although the company says both the decentralized storage network and the token remain fully operational.

According to Storj, the filing is intended to resolve financial obligations dating back to an earlier stage of the company’s development. Management says the underlying business remains healthy, but legacy debt has become a barrier to future growth.

Storj seeks to restructure legacy debt

The Chapter 11 case was filed in the U.S. Bankruptcy Court for the Northern District of West Virginia. Unlike a liquidation, Chapter 11 allows companies to continue operating while restructuring their finances under court supervision.

Kaloyan Raev, Storj’s Director of Software Engineering, said the company’s core business is “strong and right sized,” but that historical obligations continue to weigh on its future.

STORJ holders could receive equity

Storj says nothing changes for token holders immediately. The storage network continues to operate across tens of thousands of storage nodes in more than 100 countries.

As part of its restructuring plan, the company intends to offer STORJ holders equity in the reorganized business. However, the proposal still requires court approval, and creditors must be repaid before any value can be distributed to token holders. Storj acknowledged that it can express its intentions but cannot guarantee the final outcome.

Of the token’s total supply of 425 million STORJ, approximately 143.8 million are currently in circulation.

Previous acquisition did not prevent restructuring

In October 2025, Inveniam Capital Partners announced its acquisition of Storj, stating that contracts, pricing, and management would remain unchanged while increasing the utility of the STORJ token.

Despite those plans, the token has declined by roughly 60% since the acquisition announcement. Following the Chapter 11 filing, STORJ dropped another 17.7%.

Storj says it will continue providing updates as the bankruptcy proceedings progress and more details become available regarding the proposed equity distribution.