I think it doesn't have the same problem a challenger to other social media sites would have.

A Facebook killer has to contend with everyone's friends already being on Facebook, same for Twitter, Instagram, and so on. This problem is probably why threads links to your Instagram account, to try and convince users that their friends are all technically already on the site!

With reddit though? Nobody's on Reddit because of who they know, in fact people discovering each other's handles will sometimes lead to frantic account deletions and reinstallations.

For this reason, I think Lemmy will do much better than other killer sites, however, it's probably still not going to surpass Reddit by a longshot, mainly because while nobody cares about their friends already being on Reddit, they will care about not wanting to go through the bother of creating a whole new account and navigating how the fediverse system works for a maybe better version of what they're already getting.

Reddit's overall quality would have to drop into the damned abyss to cause enough of a mass exodus for a competitor to take it out for good.