Although Lemmy is free and open source, the main power is the federation. The most valuable thing that Lemmy has, are its users and the content (this is the same for Reddit). And because of the federation every instance in the Lemmy network has these assets.

Let's say one instance would get massive, and would stop federating and start charging for API access. If that happened, we would be in the same situation as now with Reddit. Yea, it would e a lot easier to set up your own instance, but you would still need to convince all these people to give up that main instance. So I'm really happy that federation basically would mean that all other instances could cut that massive instance out and still have all the data.