There are many instances and instance operators to choose from. At least one of the choices may be sufficiently trustworthy for most users (e.g. an instance for their city run by someone in the neighborhood). You could also run your own instance.

These options are better than trusting a corporation.

> The instance operator can see everything because there's no encryption.

What additionally is an instance operator seeing that isn't already public? Are you referring to direct messages and privacy/blocklist settings?

The moment a non-tech/non-enthusiast user has to choose a server you already lost them. Same reason IRC never went mainstream.

Maybe, maybe not.

People adapt. Radio dials. BBSs. AOL short-names or something like that. URLs. And so on.

Likewise Twitter, Reddit, and Facebook.

Hadn't stopped them.