Storj Labs, the company behind the decentralized cloud storage network, filed for Chapter 11 bankruptcy protection on July 26, 2026, in a federal bankruptcy court in West Virginia. The case, number 5:26-bk-00512, marks the second crypto-related bankruptcy this month after MVMT Labs filed on July 15. Storj says its network and STORJ tokens will continue operating normally during the restructuring.
What the filing means for the Storj network
The company stressed that the decentralized storage platform remains functional. Users can still upload and retrieve files, and the STORJ token continues to trade. But the bankruptcy process introduces a clear hierarchy: creditors will be paid before token holders. That means anyone holding STORJ tokens hoping for a quick recovery may have to wait — and may not get full value.
Token holders face uncertain path to equity
Storj plans to offer token holders equity in the restructured company, but the rules for eligibility haven't been finalized. Any such plan requires court approval, and details remain scarce. The letter to token holders was signed by Kaloyan Raev, the director of software engineering, not by CEO Colby Winegar. That unusual sign-off suggests the company is leaning on technical leadership to communicate with its community during the legal process.
Approximately 143.8 million STORJ tokens are in free circulation out of a total supply of 425 million. That means about a third of all tokens are actively traded, giving the token a relatively liquid market — but also exposing a large number of holders to the bankruptcy's outcome.
Acquisition aftermath and token price decline
Inveniam Capital Partners announced the acquisition of Storj on October 22, 2025, promising no changes to contracts, pricing, or leadership. At the time, STORJ traded near $0.1872. Since then, the token has fallen about 60% to around $0.0745. The acquisition was supposed to provide stability, but the bankruptcy filing suggests the financial picture worsened despite the deal.
A second crypto firm in bankruptcy this month
Storj's filing comes just 11 days after MVMT Labs filed for Chapter 11 on July 15, 2026. Ten days later, MVMT's MOVE token hit a record low of $0.00964. The back-to-back bankruptcies highlight ongoing stress in the crypto sector, where token prices have struggled and business models remain under pressure.
For Storj token holders, the next milestone is the court's decision on the equity plan. Until then, the company's promise of a token-to-equity swap remains just that — a promise, with no guarantee of how much value, if any, will flow back to the people who kept the network running.
