“Lemmy’s largest server, Lemmy.world has defederated from a large server that is dedicated to piracy, citing regulatory reasons…”

No it hasn’t.

OP, I don’t know if you’re the person who maintains this site or not but this is not accurate. .world has blocked 2 communities on dbzer0 and 1 on .ml, no defederation has taken place. Whoever wrote that article needs to rewrite a lot of it.