I think federation wars will cause that end point. If I wanted to start a community- or group of communities- I’d put them on their own instance and not have user signups. That minimizes exposure to conflict - either you like sports communities / Pathfinder communities / whatever or you don’t. If beehaw wants to lock themselves down it doesn’t affect my community. If Lemmy.world gets blocked by a bunch of instances it doesn’t affect my community. I don’t have to deal with the consequences on other instances of users coming from my instance.

I’d go a step further and say that identity management should exist separately from content, but that would probably break brains already struggling with the concept of federation.