Key takeaways:
- According to ConsenSys, it does not levy taxes on cryptocurrency users.
- Only certain of the platform’s paid services are subject to sales tax collection, according to MetaMask.
The company ConsenSys, which created the cryptocurrency wallet MetaMask, has shot off rumors that it levies taxes on cryptocurrency users.
The most popular cryptocurrency wallet platform in the market makes it very clear that the “tax and payment” scope only applies to products and paid plans provided by ConsenSys, such as credit-card-paid subscriptions to the Ethereum API Infura. It’s possible that some legal jargon has been misconstrued, but it needs to be made clear that MetaMask and other items that don’t charge sales tax are exempt from this.
ConsenSys, the parent firm of the MetaMask wallet application, did not collect taxes from cryptocurrency users, according to a formal notification made yesterday. According to ConsenSys’ tweets:
“Let’s clarify one thing upfront: MetaMask does NOT collect taxes on crypto transactions and we have not made any changes to our terms to do so.”
The company clarified that the tax clause in its terms of service only applied to the paid plans and goods that were being provided and had nothing to do with on-chain cryptocurrency transactions. The company said:
“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.”
Before, rumors circulated in the crypto community regarding the terms of service changes made by MetaMask and ConsenSys in April 2023. Section 4.3 of it contains a warning that the company would deduct taxes, additional fees, penalties, interest, and charges for the government. The claim, as mentioned above, rapidly surfaced on Reddit and was met with a range of reactions, the majority of which were negative.
Even further rumors claimed that MetaMask might freeze user payments due to tax problems. However, nothing in the platform’s terms of service or any code indicates that the project is permitted to do this.
Although MetaMask users are exempt from paying consumption tax, most countries require cryptocurrency investors to record and pay tax on gains. Once acknowledged, users of MetaMask should continue to pay all taxes due.
Taylor Monahan, the creator of MetaMask, revealed a significant money-sucking operation in April that had been going on since December 2022. Members of the seasoned community who were “reasonably secure” had their NFTs and coins valued at more than $10.5 million stolen by the vulnerability.
