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.


Get the news in your inbox. Explore Blockworks newsletters:

Tags

Decoding crypto and the markets. Daily, with Byron Gilliam.

Upcoming Events

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

Unlocked by Template (10).png

Research

Innovations on Aptos’ technical design through Raptr, Shardines, and Zaptos approach near-optimal latency and throughput by unlocking 100% utilization of network resources, with the capacity to settle 260k transactions per second with latencies less than 800ms. The original Move language was revamped with the launch of Move 2, supporting more expressivity in smart contract logic and a scalable ability to interact with high volume datasets. The ecosystem has benefitted from strong asset inflows, now hosting over $1.3B in stablecoins, $450M in bridged BTC, and $530M in RWAs. Activity in the Aptos ecosystem has grown notably over the past year, with monthly application revenue reaching ~$835k and monthly DEX volumes growing to over $5B, both at new all time highs.

article-image

Interchain Labs will focus on sovereign L1s and institutional demand, abandoning plans for smart contracts on the Cosmos Hub

article-image

Also, only three tokens have outperformed bitcoin so far this year: XMR, HYPE and SKY

article-image

The fund group has submitted proposals in recent months for other funds that would hold litecoin, solana, XRP, HBAR, Sui and others

article-image

Momentum’s back — BTC leads, risk assets follow

article-image

Ondo Finance’s acquisition of blockchain development company Strangelove follows its buy of Oasis Pro

article-image

Cryptocurrency and stock traders alike had a lot to unpack Wednesday