I've considered two reasons why Lemmy user and mod functions are very limited.

1. Cost to bring in programmers to add these features. And
2. Reddit may sue Lemmy over making their platform more similar.

As someone who first started using reedit around 2010, I do recall that most of the features were added with a big update at some point a few years later. Called "new reddit". And then additional mod features where also added over time.

Lemmy isn't as old and probably doesn't bring in the same amount of revenue.

Especially since reddit used to sell reddit gold which also was a major source of income. And allowed them to invest in software designers.

Lemmy doesn't have a ton of ads. Idk how much they make.

3. Also maybe cause people will use it regardless because of no where else to go that the owners aren't motivated to improve it.

That's capitalism for you.