In March 2025, the Web3 content creation platform Mirror (incubated by Mask Network) was exposed for not storing its core user data on-chain as promised, sparking community doubts about the authenticity of decentralized narratives. The incident originated from the developer forum, where users discovered that Mirror’s “on-chain footprint” feature only uploads the content hash to the blockchain, while the original text, images, and interaction data remain stored on AWS servers. This contradiction exposes the deep-rooted struggle between data sovereignty and technical feasibility in current decentralized applications (DApps).
Technical Vulnerabilities and Data Sovereignty Disputes
Mirror’s official explanation stated that the data was not fully on-chain due to “user experience optimization” considerations—on-chain storage costs for high-concurrency interactive data are 17 times higher than centralized servers, and storage networks like Arweave have a read latency of up to 2.3 seconds, making it difficult to meet real-time interaction requirements. However, by tracking Mirror’s smart contracts, the community found that nearly 30% of interaction requests actually call centralized APIs, which seriously deviates from the “fully on-chain” claim in the white paper.
The core conflict in this incident lies in the clash between commercial feasibility and the decentralized ideal. To reduce operating costs, Mirror selectively adopts a Hybrid Architecture, but by not disclosing the true state of its data storage to users, it has triggered a crisis of trust. Data shows that within 72 hours after the incident was exposed, Mirror’s daily active users dropped by 41%, and the price of the staked MASK token fell by 33%.
Market Impact and Industry Reflection
Mirror’s predicament reflects common challenges in Web3 infrastructure:
- Storage Cost and Efficiency Bottleneck: Even with decentralized storage solutions like Filecoin and Arweave, large-scale on-chain data still faces throughput limitations. For example, the average confirmation time for a single content update on the IPFS network is 45 seconds, compared to only 0.2 seconds on AWS.
- Regulatory and Compliance Pressure: The EU MiCA regulation requires DApps to retain user behavior logs for at least five years, but complete on-chain storage might violate GDPR’s “right to be forgotten,” forcing project teams to adopt a compromise solution.
- User Perception Bias: Most users equate “data on-chain” with “decentralization,” overlooking the fact that the execution layer of smart contracts still relies on centralized oracles.
It is worth noting that some compliant trading platforms, such as JuCoin, have already adjusted their listing standards to require project teams to disclose detailed storage architecture and have third-party audits to verify the on-chain data ratio. This “transparency-first” screening mechanism is reshaping the market’s evaluation dimensions for decentralized projects.
Technical Fixes and Ecosystem Collaboration
To regain trust, the Mirror team has proposed three remedial measures:
- Layered Storage Protocol: Force high-value data (such as copyright evidence) on-chain, while using a hybrid storage approach with IPFS and AWS for low-frequency data, and achieve verifiability through zero-knowledge proofs (zk-SNARKs).
- Data Migration Compensation: Users can apply to migrate historical content to high-performance storage chains such as Crust Network, with 60% of the migration cost subsidized by the MASK treasury.
- Decentralization of Governance: Introduce a community multi-signature mechanism so that any storage architecture changes require DAO voting and must be simultaneously updated in the smart contract state.
This incident may become a significant turning point in the evolution of Web3—when the industry shifts from “idealistic narratives” to “pragmatic construction,” finding the balance between decentralization and user experience will become the core theme of the next technological race.
Neason Oliver
