2025: The Year Web3 Showed Its Fractures - What is Web3 When Security Fails?

Web3 aims to be a trustless decentralized environment, but 2025 proved that this promise is still far from being a reality. The industry faced a cascade of crises exposing the structural vulnerabilities of this emerging technology: from external attacks to internal betrayals, the ecosystem’s reality has become much darker.

Large-Scale Thefts Shake the Market

The year began with alarming news about platform security. A criminal group managed to divert $100 million from a political meme coin, revealing critical gaps in protection mechanisms. Months later, an internal incident further shook confidence: an Infini employee embezzled nearly $50 million, demonstrating that threats come not only from outside but also from within organizations.

These events raise a fundamental question about what Web3 is: if the decentralized model promises security and transparency, why does it remain vulnerable to billion-dollar thefts? The answer lies in the immaturity of governance and oversight protocols.

Market Manipulation and Reserve Disputes

The situation worsened when a major market participant (whale) interfered with Polymarket’s price data, manipulating an oracle and demonstrating how actors with significant resources can distort the market. Simultaneously, a controversy involving TUSD reserve funds raised questions about the stability of stablecoins—key pillars of Web3 infrastructure.

Credibility and Governance Crises

The industry was also impacted by bizarre events: the false death announcement of a co-founder of the Zerebro project caused panic in the markets, while a failed attempt to list Conflux via reverse shell signaled structural issues in operations and reliability.

What Do These Events Reveal About Web3?

These chain reactions reveal an uncomfortable truth: Web3 is still a work in progress, where technological innovation advances faster than protection mechanisms. The industry needs to evolve in governance, internal oversight, and security design to fulfill the original decentralized promise. Without these structural changes, events like these are likely to recur, consolidating distrust around the sector.