From the new terms:
When you upload or input information through Firefox, you hereby grant us a nonexclusive, royalty-free, worldwide license to use that information to help you navigate, experience, and interact with online content as you indicate with your use of Firefox.
The problem is that using vague language makes people suspect, because companies nowadays tend to move towards enshittification.
Fair enough, I get the caution honestly. Nobody wants Firefox to enshittify like everything else.