I can see how it may appear that way, but we are hoping this is just a temporary state until mod and admin tools can catch up to the scale. Open signups and a flood of users in some of the big instances is not necessarily a problem by itself, but the moderation tools Lemmy has today are pretty rudimentary at the moment. This is certainly the case intra-instance, but is exacerbated once cross-instance moderation comes into play, especially when each instance has its own culture, rules, etc.
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