Speaking from experience, they could fix their spam and abuse woes very easily by just closing new signups or restricting it in some way. Simplest would be invite-only (built-in feature of Mastodon), or restrict the signups page based on IP range whitelist/blacklist.

EDIT: Their domain has been reinstated, and they disabled open signups. New registrations now require moderator approval https://pawoo.net/@pawoo_support/111249170584706318

:pawoo: Announcement! Thank you for always using Pawoo. Due to server congestion, new registrations will now require approval by a moderator. Thank you very much for your cooperation.