Eventually, you'll reach the point where a duopoly will effectively control who is allowed to be part of the larger network. And this was the original problem people were trying to solve by creating a federated network.
What fresh nonsense is this? There's never been a federated system with anything like a perfect guarantee of connectivity to literally anything. There are always limits, both social and technical.
Where do people get these ideas?
It's the case that a federation tends to erode. Likewise, it's the case that a centralized system tends to collapse.
The question to ask is really one of backing a horse to ride on to be pragmatically useful; winning the technical argument is academic.
The fediverse has a few core principles in mind, and they tend to get centered in Mastodon's marketing. So it does make some sense that it gets attacked for being an imperfect realization of those principles, and for being unprincipled in other respects. But in a head-to-head comparison with other implementations of social media it can still claim to be more principled on those things it tried to pursue.
For this to work it needs to be treated as a common carrier, and not a social network.
Dystopian would be dictating that everyone operates the software they choose to run using their own time and resources in the same exact way.
Also, is the functionality dystopian or the application thereof?