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Web3’s struggle with user data: a backslide to web2

Web3's Data Dilemma | Users Demand Ownership Beyond Web2

By

Zara Al-Mansoori

Aug 29, 2025, 05:13 AM

Edited By

Nina Soboleva

Updated

Aug 30, 2025, 02:57 AM

2 minutes to read

Illustration of a person holding a digital shield representing user data ownership in Web3. Surrounding are icons of data, identity, and consent.

A growing coalition of users is pushing back against trends in the Web3 sphere, asserting that many projects are slipping back into Web2 habits by hoarding user data. This movement for clearer data ownership underscores crucial points in the digital identity conversation.

Point of Contention: Clarity in Data Consent

The demand for real consent in Web3 applications is intensifying. Users emphasize that clarity and choice must define data requirements. One commenter expressed, "Real consent means users know exactly what data is being requested, why it’s needed, and can revoke it anytime. Anything less feels like Web2 disguised as Web3."

Embracing Innovative Solutions

Innovative initiatives are emerging amid user demands for control:

  • Zero-Knowledge Proofs: Projects such as Polygon ID enable users to validate credentials without exposing sensitive information. A comment noted, "Projects using ZK-proofs let people prove something about themselves without revealing raw data."

  • Decentralized Identity (DID): Users propose integrating DIDs with ZK-proofs to enhance privacy and portability in data utilization.

While opinions vary, many believe these advancements align closely with the vision for a user-focused Web3.

Navigating AI Agents Safely

AI agents introduce complexity in user data management, as members express concerns about potential data leaks. Comments highlight that agents should authenticate through DIDs combined with cryptographic signatures, allowing minimal data disclosure. One user remarked, "If AI agents are going to manage our data, they should use DIDs effectively without revealing raw information."

User Value Redistribution

As demand grows for equitable data usage, several users underscore the need for direct reward systems reflecting user contributions. Comments suggest, "If platforms profit from my data, I should share in that value. Otherwise, it’s just Web2 all over again." Possible implementations include tokens, discounts, or governance participation.

Cross-Chain Reputation and Migration

The hindrance of siloed reputations in current applications needs addressing. Community input advocates for cross-chain identity standards, stating, "If my DID and reputation scores can travel with me, I won’t be 'locked in' by one app." This transition is viewed as vital for creating truly portable and actionable reputations in the ecosystem.

"Cross-chain standards aren’t just β€˜nice to have’; they’re the only way reputation has real value to the user."

Summary of Insights

  • β–² Users demand clear data usage guidelines for genuine consent.

  • β–Ό Innovative projects like Polygon ID lead in privacy-focused verification.

  • ✦ AI agent control and security are non-negotiable for user trust.

  • βœ“ Users expect platforms to share financial benefits driven by their data.

  • βœ” Cross-chain reputation migration is critical for user freedom in the ecosystem.

The debate around user data ownership and the ethical use of AI remains heated, posing significant implications for the future of Web3. Will platforms act accordingly to regain user trust in an ever-changing digital landscape?