It's different on other platforms (like mastodon) but on lemmy, it only blocks posts from the blocked instance. Users from Threads would still be interacting in comments with the user who blocks their instance.

Regardless, I believe they should be defederated by instance admins on ethical grounds. Meta/FB have run unethical, uninformed experiments on their users, including purposefully inducing depression in their users.

The fact that Meta has assisted in genocide should be grounds for defederation by instances which claim to protect and care about their users.

Meta's platforms have also played a key role in radicalizing users, and they purposefully marketed Threads to far-right extremists.

Here's my argument with citations

There's also good arguments to defederate and block them from the fedivers based on EEE.

If an instance's admins claim they care about protecting their users and providing a safe, healthy community but are federated with Threads, then they are either uninformed or liars.