The permission “Access your data for all websites”, is not about reading your passwords etc. It's ability to read and modify websites you visit, and to fire an event based on its content. The reason why it’s worded this way is because a web page can contain virtually anything, and some extensions need to read everything on it in order to perform an action based on what the page contains. For example, an ad blocker needs to read all web page content to identify and remove ad code. Since these types of extensions wouldn’t know whether any particular web page contains the bit it needs to modify until it’s loaded, and neither does Firefox, it needs access to everything on a page so it can look for and modify the appropriate parts. This means that in theory, while rare, a malicious developer could tell you their extension does one thing while it actually does something else. We have been taking steps to reduce the risk of extensions, the most significant of which was moving to a WebExtensions architecture with the release of Firefox 57 last fall. The new APIs limit an extension’s ability to access certain parts of the browser and the information they process. We also have a variety of security measures in place, such as a review process that is designed to make it difficult for malicious developers to publish extensions. Nevertheless, these systems cannot guarantee that extensions will be 100% safe.