Storj filed for bankruptcy protection on Sunday, saying its network remains operational and STORJ tokens continue to function. The company is now seeking to give token holders a stake in a reorganized Storj, but any such plan would require court approval, and creditors must be paid before owners.

Why Storj Filed for Chapter 11

Storj Labs filed in federal bankruptcy court in West Virginia under case number 5:26-bk-00512. In a July 26, 2026 post on X, the company described the process as a voluntary financial restructuring.

Today Storj began a voluntary financial restructuring — an accelerated, court-supervised reorganization to resolve legacy liabilities that predate our current strategy. The business and network continue as normal. 🧵 — Storj (@storj) July 26, 2026

Today Storj began a voluntary financial restructuring — an accelerated, court-supervised reorganization to resolve legacy liabilities that predate our current strategy. The business and network continue as normal. 🧵

Chapter 11 does not mean an immediate shutdown. The process allows a company to continue operating while a bankruptcy court oversees efforts to address its debts. In a reorganization, the court process can also determine how existing obligations, ownership interests, and any new equity are treated under a confirmed plan.

Storj says the liabilities are legacy obligations tied to an earlier stage of the business and that the company cannot grow its way out of them under the current structure.

“The business underneath is strong and right-sized. What holds it back are legacy obligations from an earlier chapter.”

The statement was attributed to Kaloyan Raev, Storj’s director of software engineering. Raev also signed the company’s letter to token holders, rather than Chief Executive Colby Winegar.

What the Filing Means for STORJ Holders

Storj says there is no immediate change for STORJ tokens. According to the company, data continues to move across tens of thousands of storage locations in more than 100 countries.

The company plans to offer token holders equity in the new Storj. Equity represents part-ownership in a company. However, the eligibility rules for token holders have not yet been written, and token ownership by itself does not establish what holders would receive in bankruptcy unless those terms are included in a court-approved plan.

Those rules will be significant for holders. About 143.8 million STORJ trade freely out of a total supply of 425 million, while roughly two-thirds of the supply is held elsewhere.

Bankruptcy proceedings also follow a payment priority. Creditors are paid before owners, and Storj’s letter to token holders acknowledges that the company can state its intention but cannot guarantee the outcome. Token holders will therefore need to watch the company’s proposed plan, any eligibility cutoff, and the court’s treatment of the equity offer.

Inveniam’s October Acquisition Announcement

Inveniam Capital Partners announced on Oct. 22, 2025, that it was buying Storj. At the time, Inveniam said there would be no changes to contracts, pricing, or leadership.

“We’re particularly excited to integrate the STORJ token into our ecosystem, driving greater utility and alignment across our platforms.”

The comment came from Patrick O’Meara, Inveniam’s chairman and chief executive. STORJ traded near $0.1872 on the day of the announcement and has fallen about 60% since then.

Another recent comparison came from MVMT Labs, which filed for Chapter 11 in Delaware on July 15. Its Movement (MOVE) token reached a record low of $0.00964 ten days later.

STORJ has so far traded near $0.0745, up 1.5% on the day. Its volume was $5.6 million, with a market value of $10.7 million.

The broader storage and infrastructure token sector has also been weak, even as network usage has grown. Storj says it will share court dates as they become available. The details of the proposed equity offer will determine what token holders may ultimately receive.