Using Farside means the initial redirect goes through Farside, so they are capable of knowing what videos you're watching, what tweets you're looking at, etc. You have to trust them not to monitor this. Using a client-side extension means only the instance you use knows this.

It's a Go project that seems trivial to self-host. By your logic we shouldn't trust any of the instances of the alternative services either since anyone could be monitoring their use as well.