People aren’t going to go to other instances if they close LW. They’re going to go back to Reddit or Twitter or whatever platform they came from. Adding additional barriers to entry is not a good thing.
I’d bet 75%+ of the people on the platform don’t really understand or care about federation. They want something that works. And outside of the DDOS/Attacks LW has worked extremely well. Decentralization isn’t a perk to most users.
As the fediverse scales 100k user instances aren’t going to be uncommon, and that’s fine. LW is serving as a pseudo test bed and it’s exposed a lot of problems that would not otherwise get fixed.