A large open source project is generally more secure than a closed source one as it has more developers working on it and more security experts reading the code or testing it. If you want an example look at how many developers are working on Linux vs Windows and there security history. Once lemmy is big enough it has the potential to be more secure than things like Facebook or Twitter even.

You apparently don’t understand how password hashes work. Nobody is storing your password on any well implemented website. You can’t just grab someone’s password if there is a breach, provided the people who built the website aren’t completely incompetent.

With these misunderstandings and the fact federation was confusing to you I am not sure I believe your claim that you are a “tech-friendly” person. You sound like someone who has above average exposure to technology rather than someone who is actually skilled in it. There is nothing wrong with this in itself but please don’t claim to be proficient when you aren’t.