This has some pros and cons:

You might say - ok but I don't care about instances, servers and whatnot. Also now instead of one Reddit website, we have thousands of them! Do I need to register everywhere? I don't want this, I just want to to come to Reddit and browse stuff from everywhere!

... and this is possible! Instances can communicate with eachother so with account on one instance you can connect (not login) to all the instances you want. Basically your browser or smartphone app just now needs to download posts from different servers instead of one giant Reddit server. But it needs your help, you need to specify the address of the instance otherwise it doesn't know where to connect. This is the same as email, if you want to send an email to John Smith, you don't just write recipient as john.smith, you need to write the server also so john.smith@gmail.com

So if I take the example from previous comment, you cannot just write that you want subscribe to r/funny because your app or browser doesn't know where the r/funny is. You'd need to write funny@my-server123.com or europe@eu.gov. And voila, that's basically Lemmy