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Potentially both simultaneously.
I think that a few key factors would be:
Either way the prospect is good. Users using Bluesky is still a better love story than Twitterlight. [EDIT: sarcasm intended. It's better than Twitter, but not by much. As Technocrit correctly highlighted, the Fediverse is still way better.]
your last point is key. Bluesky has notoriously horrible moderation and a CEO that refuses to acknowledge it and mocks users that do.
This reeks of Bluesky letting "the babies have their bottles" so to speak but I feel it's a waste of time. Bluesky users already heavily depend on lists to build their own communities in a way. It's almost to the point on there where if something you dislike shows up in your feed well that's your fault and the communities as a whole for not almost shadow banning an account via the god knows how many block lists users have created. "disliking" a post isn't going to do anything. it's stupid.
Hell Bluesky users have been trying to get some transphobic journalist banned from the platform for well over a year now and the CEO of Bluesky has essentially said "lol, nope, you all suck. don't like it? stop posting in protest." When Bluesky users are offered an alternative with better moderation that THEY can control i.e. Mastodon they tut their tongues and roll their eyes saying "eww the linux of social media".
so again, let the babies have their bottles. it's not going to do anything because Bluesky has clearly said they don't want to do anything.
Not true - it seems designed to increase advertising revenue for the CEO:-P. That's... "something", technically? 🤪