Storj Labs Files for Chapter 11 Bankruptcy Amid Legacy Debt
Storj Labs has filed for Chapter 11 bankruptcy protection in West Virginia's federal bankruptcy court, citing legacy debt from previous business operations.
The company, which operates a decentralized cloud storage network, secured approximately $35 million through venture capital and a 2017 token offering.
According to Kaloyan Raev, director of software engineering at Storj Labs, the current business is operationally sound but burdened by historical financial obligations.
The company intends to maintain uninterrupted network operations and customer support throughout the reorganization process.
A proposed equity conversion mechanism for STORJ token holders is under development, which would allow them to acquire equity stakes in the post-reorganization entity.