Storj Labs Files for Chapter 11 Bankruptcy Amid Debt Issues
Storj Labs, the company behind decentralized cloud storage network Storj, has filed for Chapter 11 bankruptcy protection in an effort to address legacy debt while continuing operations.
The company raised approximately $35 million through venture funding and its 2017 STORJ token sale. However, it now faces debt problems tied to an earlier phase of the business.
Kaloyan Raev, Storj's director of software engineering, stated that the business is 'strong and right-sized' but held back by older financial commitments.
Storj plans to propose a mechanism allowing STORJ tokenholders to participate in ownership of the reorganized company. The network operations and customer services are expected to continue during restructuring.
The company has narrowed its business focus, disposing of earlier acquisitions and non-essential operations as part of the restructuring process.