ConsenSys Dispels MetaMask Terms of Use Update Confusion

Updated terms did not relate to taxes and ConsenSys said that taxes apply solely to specific products and paid plans

article-image

Iryna Budanova/Shutterstock, modified by Blockworks

share

ConsenSys, the Ethereum studio behind self-custodial wallet MetaMask, clarified to users that it neither collects taxes on crypto transactions nor implemented any related changes to its terms.

The clarification followed concerns raised by the crypto community regarding MetaMask and one section of its terms of service, with some suggesting a new update could enable the company to retain taxes.

Section 4.3 of MetaMask’s terms of service states, “We retain the right to withhold taxes as necessary.” While the tax-related aspect was neither an update nor new information, it has certainly caused some confusion now.

The confusion arose from several Twitter posts that brought attention to the section concerning taxes, which subsequently gained significant traction on Reddit.

While Metamask did update the Terms of Use for its popular browser extension last week, the changes were related to language in various sections concerning “Third-Party Offerings” and a jurisdictional move from Texas to New York, and not to section 4.3.

In a tweet thread on May 22, ConsenSys clarified that taxes are only applicable to specific products and paid plans. For example, Infura, which is MetaMask’s Application Programming Interface (API) tool, includes sales tax in its credit card developer subscriptions.

Loading Tweet..

“Legal terminology can be complex, but it’s crucial to emphasize that this section DOES NOT apply to MetaMask or any other products that don’t involve sales tax,” the team added.

One widely circulated tweet falsely suggested that MetaMask would hold a user’s cryptocurrency if they failed to pay taxes. 

The Twitter user further drew comparisons to Ledger’s recent firmware update for hardware wallets, raising concerns about an ID-based key recovery service that mandates users to provide identification for backup. There are worries regarding the security of custodian companies and potential risks for users who choose not to participate.

ConsenSys faced criticism last year for gathering users’ IP addresses and Ethereum wallet addresses. In addition to these, ConsenSys also said it collects usernames, passwords, gender information, and financial data including asset holdings, bank account numbers, and bank routing numbers. 

The team clarified that the updates to its terms of use — which users agree to when they use the product — aimed to educate users about how MetaMask operates.


Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the On the Margin newsletter.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.

Tags

Upcoming Events

Salt Lake City, UT

MON - TUES, OCT. 7 - 8, 2024

Blockworks and Bankless in collaboration with buidlbox are excited to announce the second installment of the Permissionless Hackathon – taking place October 7-8 in Salt Lake City, Utah. We’ve partnered with buidlbox to bring together the brightest minds in crypto for […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Research Report Templates.png

Research

ZKPs enable efficient offchain transaction processing and validation, resulting in increased throughput and reduced fees. Solana's ZK Compression leverages ZKPs to minimize onchain storage costs, while Sui's zkLogin streamlines user onboarding by replacing complex key management with familiar OAuth credentials.

article-image

Plus, is Polymarket this cycle’s breakthrough mainstream app?

article-image

The crypto asset manager lowered its planned fee from 0.25% to 0.15%, undercutting its competitors

article-image

Plus, a look at planned ETH ETF fees and how they differ from their BTC counterparts

article-image

North Korea suspected in breach of Indian exchange’s multisig wallet

article-image

Plus, Sanctum’s CLOUD token has officially launched — but not without problems

article-image

It’s not yet clear whether Donald Trump is pumping bitcoin. But an unofficial memecoin is still seeing benefit.