Do you enjoy dealing with defederating every spam and underage-porn instances all by yourself? Or do you just procrastinate and let the spam flow through? 😄 I know I can't manage all that stuff by my self. If I accidentally federated with an instance with illegal content, I could be in trouble, but with using someone else's instance, I'm not liable for stuff on their servers.
But also the costs would not be worth it. So that's why I don't self host.
Lemmy actually has both allowlist and blocklist modes. I think the default is blocklist because there are a lot more niche/single-user instances that are legitimate than ones that aren't.