If an instance were to leave the fediverse do we loose all its data? Say for example iPad Lenny.ml domain was seized or was forced to shutdown so we loose all communities from that host? Do we not see any posts? Can we still post to it? Seems like a big flaw if we have multiple large instances that can shutdown a significant portion of Lemmy.
We lose the communities from that instance, yes. And that’s why people want to make sure you don’t have one dominant instance on the threadiverse. But frankly that issue will be there unless you have a fully decentralised system.
That being said, other instances will have a cache of the activities happening on this other instance. You can then fairly easily recreate it from this cache, and if you have a lot of storage, can also have a limitless cache.