[vlmutolo]

If you can only talk to other people on your own server, then the application is limited to just team chat.

Matrix clients have the potential to be much more. You can use the same account for various team chats and still use it like a messaging app for your friends and arbitrary personal groups.

Maybe most importantly, federation provides resilience against bad server operators. If Signal had allowed federation, it wouldn't have been a big deal to ditch its servers when they introduced a sketchy cryptocurrency onto the platform. Because they don't allow it, everyone was locked in.