Is it possible to upgrade or level-up weapons?

I was curious about some of the loot I have acquired since Act 2 and was wondering if it was possible to upgrade some low level magical weapons and bring them up to your party level. There are some magical items in my stash that have decent properties/abilities to them but are otherwise lower level considering when I purchased/found them in the campaign. I just have em tucked away in my stash for now but is it worth holding on to them? Is there an upgrade mechanic that unlocks somewhere further along the way? I am just looking to going back to using my Wide Sweep Scythe tbh.

AFAIK no for generic weapons. There are some special ones that can be upgraded, like Radiance and Finnean.

You can also upgrade Staunton’s Soulshear via a project inside Crusade Management in act 3. And restore/upgrade/change relics into more powerful weapons and/or equipment. Depending what you decide to select during their “restauration order”.

I’d keep the crystal chisel/dagger from act 1 around if you still have it.

Can you actually keep it? For me I am pretty sure that the dagger got destroyed after the wardstone event. Maybe it depends on which decision you take for the wardstone? I took the Aeon option.

Depends which choice you make. Aeon choice destroys the dagger for instance. But Demon choice keeps it: you use your bare hands to crack open the wardstone after all.

You mean the purple stone dagger from the market square? Yes, I stashed in my chest

Not if you took the Aeon path, no.