Since its perhaps one of the most controversial aspects of instance moderation, I thought it might be worthwhile to discuss how we handle remote user and instance blocks queer at queer.af:
Firstly, we mostly act reactively. We aren't out trawling through the fediverse looking for the poop; we mostly rely on either seeing it in the federated timeline or reports from users.
We prefer to apply restrictions at user-level, but this depends upon circumstances. An instance which doesn't respond to harrassment by a member, or which has "pro free speech" dogwhistles in its terms of service will probably find itself blocked. One where a substantial fraction of the home timeline would be tagged by our local rules will probably find itself silcenced.
Some decisions are straightforward, and we'll action them straight off (e.g. there's absolutely no need to discuss an instance swarming with nazis). Some are less so, and we'll discuss them among themselves. We occasionally post updates to @postmaster if we think our decisions (especially instance blocks) may be relevant to our users
queer.af, your cosy queer space queer.af is a mastodon instance for those who are queer or queer-adjacent who would like a more pleasant social media experience.