End-to-end encryption reduces what an attacker in this position would be able to do, but it doesn't make the situation safe. Even if they can't observe or directly tamper with the data they're relaying, they can still observe metadata, like who the peers are and how much bandwidth is being relayed. Even just measuring the pattern of packet sizes can be disturbingly revealing:
https://www.cs.jhu.edu/~cwright/oakland08.pdf
Besides, end-to-end encryption doesn't do anything to allay concerns about abuse of users' resources.