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I mean, even a lot of the bigger lemmy instances are of mixed thought on whether to federate with “piracy” instances (I want to say lemmy.world federated and defederated a couple times?).
Reddit Corporate is trying to go public. The piracy subs were going to be purged sooner than later and The Exodus was an opportunity to move the community en masse.
AFAIK, lemmy.world only blocked [email protected] community, not the whole instance, and unblocked it a few months afterwards.