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- 1 Within a week, another crypto wallet service provider fell into controversy.
- 2 Consensys clarified the misinterpretation of Metamask’s crypto tax clause .
The parent company of software crypto wallet Metamask, Consensys, recently found itself in a discomforting situation. People over social media platforms calling out the private blockchain software firm for an alleged withholding of taxes. The whole facade surfaced after a misinterpretation of its terms of service. The company took to Twitter and clarified its stance on the rumors.
Consensys Clarified Metamask’s Tax Clause
In a Twitter thread posted on Monday, May 22, Consensys asserted to have knowledge of tweets containing “inaccurate information.” Further, the firm clarified that its wallet service Metamask is not involved in collecting taxes on crypto transactions. There are no such changes in the terms, and the “claim is false.”
Further, it clarified the segment of tax mentioned in terms of service was for the products that sales tax. The tax section is under the “fees and payment” section concerned with the company’s “products and paid plans” only.
Though “legal terminology can be complex,” the company noted the section was not meant for any product offered by Consensys that does not involve sales tax. For instance, MetaMask is out of the tax obligations while its other offerings, like Infura, have sales tax since it has credit card developer subscriptions.
“We believe in transparency and accuracy when it comes to sharing information with our users.” Consensys wrote.
Strife In the Community
The explanation from the MetaMask developer firm came in the wake of rumors surfacing on social media platforms. On Sunday, May 21, several users highlighted the terms of use of Metamask’s section 4.3 under the “fees and payment” section. The crypto community members highlighted the sentence, “We reserve the right to withhold taxes where required.” It acted as the root cause of this issue.
From Twitter to Reddit, there were posts in abundance calling out the instance. On Reddit, the r/CryptoCurrency community pushed the claim of the company withholding taxes. It has seen 548 upvotes and 624 comments by now.
However, there were people in support of Consensys and pushed back the claims of tax. A Twitter user noted the mistake was not in the tax clause of MetaMask, but it was in reading it. The tweet explained that in case of buying any product, the company could withhold taxes on the product, akin to Amazon, etc.
Ledger Fell Into Controversy Earlier
The instance was directly compared with the recent one with another controversy with the crypto wallet Ledger. The company proposed an update that would offer the seed phrase recovery service. It had to face backlash as the community opposed it and called it a “backdoor.”
Nancy J. Allen is a crypto enthusiast, with a major in macroeconomics and minor in business statistics. She believes that cryptocurrencies inspire people to be their own banks, and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning. She frequently researches, and posts content on the top altcoins, their theoretical working principles and technical price predictions.
