Lemmy.world is just the (only) pre-configured Lemmy instance. But you can add more yourself, e. g. your home instance where your main account lives.
You can add more instances, but don’t have need to sign up on each. Now the cool thing, that makes LiftOff special. You can switch to one of those instances and browse them to view only their local communities or all that are available on that instance. You don’t need an account for this, but you can’t vote or reply directly. However, Liftoff offers to switch to the copy of the same post/comment you’re viewing, that lives on your home instance, where you’re signed up, so you can vote or reply.
You could (but don’t have to) sign up on these other instances. Usually you pick an instance you like most to sign up, then browse the copies (= federation) of other instances that are on your home instances.
But LiftOff allows you to easily browse other instances directly (no copies), like some travel mode. Sign up on these other instances and you have a holiday home there. By this you can e. g. keep your personas separate from each other.
The switch feature is also very handy if you simply want to browse an instance that’s defederated (= no copies of posts/comments are shared) from your home instance.