I think many people lost interest once the initial excitement faded. Reddit is so vast that there is never a shortage of content and people to interact with it. Lemmy doesn't have the same vastness, most content creators don't get a lot of engagement so they're not as motivated, users don't have that many things to scroll through so they start checking in less often, etc.

The growing pains Lemmy has been experiencing have certainly left many a bit disillusioned too. People in general don't really want to put in effort towards anything they don't have to, and many things about Lemmy require a bit of effort. But overall I like Lemmy and I'm optimistic about it, I think it will do fine eventually, as long as we stick around.