In addition to what the others have said, we’ve lost some big and popular instances (Vlemmy, FMHY and others) along with the communities they had. Also, with the 2 biggest (lemmy.world and lemmy.ml) coming under attack every week, some users want to be on a smaller instance that’s under the radar.

Finally, people want to choose an instance that fits their interests/beliefs. I chose mine mainly for what they don’t allow and who they’re defederated from, but to each his own.