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Lemmy Instance on Small Private Server?
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Lemmy is very lightweight due to being written in Rust. I think you won't have as much problems with the CPU as with the networking and bandwidth. It's hard to host a reliable site from your home, usually requiring dynamic DNS, port forwarding, and very strong firewalling. The bandwidth usage is probably minimal if you decide to host images on separate servers like imgur, but still could be significant.
Maybe I'd limit the number of people to around five to see what the usage was like. It's sounding like a fun weekend project now.