Storj Labs, the company behind the decentralized cloud storage protocol Storj, said it has voluntarily filed for Chapter 11 protection in a U.S. bankruptcy court. The company said the court-supervised process is intended to resolve legacy liabilities accumulated over several years and put the business on a healthier financial footing for the future.
Storj says the filing does not mean it is shutting down
In its announcement, Storj said the filing is a Chapter 11 reorganization rather than a Chapter 7 liquidation, and that the company will continue operating normally.
According to the company, customer data access, node operations, enterprise services, and the Storj network will remain fully available during the court process. Storj said the goal is to deal with long-standing liabilities without disrupting the current business.
Kaloyan Raev, Storj’s director of software engineering, said, “The company’s core business is actually quite healthy and has already been resized appropriately. What has really weighed on the company is the historical debt left over from earlier stages of development.”
He said Chapter 11 would allow Storj to keep operating while restructuring its debts and move into its next phase with a cleaner balance sheet.
An early decentralized storage project dating back to 2014
Storj was founded in 2014 and is one of the earliest decentralized infrastructure projects in crypto. It entered decentralized storage before Filecoin, according to the report.
The article traces the project back to founder Shawn Wilkinson’s time as a student at Morehouse College in the United States. While mining Bitcoin in his dorm room, he began asking why so much global computing power was being used only to calculate hashes instead of putting idle hard drive space to work on something with practical value.
That idea became the basis for Storj. Instead of relying on large centralized data centers, the project aimed to use spare hard drive capacity around the world, splitting files into pieces, encrypting them, and distributing them across nodes in different locations. The goal was to build a decentralized storage network with no single point of failure, lower costs, and stronger privacy properties.
What is now called DePIN, short for Decentralized Physical Infrastructure Network, was still a novel concept at the time. Storj was one of the earliest projects associated with that category.
Vitalik Buterin was involved in Storj’s early white papers
Storj also has close ties to Ethereum’s early history. In the first edition of the 2014 white paper, titled Storj: A Peer-to-Peer Cloud Storage Network, the cover listed Shawn Wilkinson and also named “Contributors: Vitalik Buterin.”
The report said that shows Buterin was not merely a public supporter, but took part in discussions around Storj’s early architecture and white paper content.
In the second edition of the white paper published in 2016, Buterin was still credited with the line “With contributions from Vitalik Buterin,” indicating that he continued to provide input on the project’s technical direction.
The article said that reflected the period as well. In 2014, Ethereum had not yet officially launched, and Buterin was actively involved in the design of a range of decentralized applications as broader blockchain infrastructure was taking shape. Storj was one of the early examples from that period.
Company says eligible STORJ holders may be able to receive equity
Storj said that after completing its acquisition by Inveniam, a private-market data infrastructure company, last year, it began selling certain non-core businesses and assets in order to refocus on its original decentralized cloud storage platform.
The company said the restructuring is another step in returning to that core strategy, with the aim of continuing operations under a leaner structure and a healthier financial position.
Alongside the court filings, Storj also released an open letter to the community outlining its post-reorganization plan. It said the future company is intended to be owned jointly by the management team, the decentralized community, STORJ token holders, and other investors.
Storj said it plans to submit a reorganization proposal to the court that would give eligible STORJ holders an opportunity to receive equity in the reorganized company.
The company added that the proposal still requires court approval. It has not disclosed eligibility criteria, allocation ratios, or execution details, and said the final terms could still change.
Storj says it will not comment on token price
Storj said the function of the STORJ token within the network has not changed. Still, until the Chapter 11 process is completed, the company said it will not comment on the token’s price and does not encourage trading based on the restructuring news.
It asked the community to rely on formal court documents and official company announcements.