Decentralized cloud storage provider Storj Labs has filed for Chapter 11 bankruptcy protection. The company said it plans to keep its network operational while restructuring existing liabilities and exploring an ownership path for STORJ token holders.

On Sunday Storj he said filed a voluntary case with the United States Bankruptcy Court for the Northern District of West Virginia. The company said that normal operations and customer service will continue during the trial, under court supervision, while its parent company, Inveniam, will continue to support the company.

The restructuring could become an unusual test of whether utility token holders can participate in the ownership of a company emerging from bankruptcy.

In an open letter to his community, Storj he said its commitments largely predate the current strategy and are too gigantic to be resolved through business development alone. It was determined that the network is still functioning normally and the token’s utility remains unchanged.

STORJ showed no significant immediate price reaction following the announcement, with the stock trading at around $0.072 at the time of writing, according to CoinGecko.

Storj is exploring an equity path for token holders

Storj said that the management board intends to propose a mechanism allowing token holders to participate in the capital of the reorganized company.

However, Storj did not disclose how eligibility of token holders would be determined, whether participation would include a token snapshot or lock, or how much capital could be allocated. The company acknowledged that any plan must align with bankruptcy priorities and receive court approval.

Cointelegraph reached out to Storja for comment but did not receive a response before publication.

Storj is one of the longest-running decentralized infrastructure projects in the cryptocurrency industry. Storj began in 2014 as an open-source, peer-to-peer cloud storage project with the goal of allowing users to rent storage from other network participants rather than relying on centralized providers.

Related: BitMEX filed a lawsuit for 623 BTC on the day the closure was announced

Storj’s bankruptcy announcement comes the same month that at least two other crypto companies sought Chapter 11 protection.

Movement Labs filed a Subchapter V filing on July 15 after months of confusion surrounding its MOVE token, and bitcoin mining company Poolin filed on July 22 in connection with the court-supervised sale of two mining sites in Texas.

BitMEX also announced in July that it would cease operations after 11 years, while BitMart said it would cease operations on August 26 and then cease operations entirely on January 31, 2027. Neither exchange announced bankruptcy, with both opting instead for organized liquidation.

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