I think at least two things are wrong with this kind of logic:
1. It’s never as simple as “if this then that”. Yes, there are studies that show short-term mood improvements in people upon leaving social networks. There are also studies on long-term health effects of reduced social connections which leads to depression and heap of other psychological problems. Guess how one connects with other people today? Through the social networks. Life may go on without online presence, but it’s a very different life from the one we were living 20 years ago, where only your weird cousin was frequenting MySpace and everyone else preferred to socialize in person.
2. These platforms consciously exploit biases and addictions in order to thrive. You may not see why people want to live through such ‘minor’ abuse as getting deleted from instagram, but it’s usually traumas that drive people to all kinds of abusive situations and self-medication, social networks being just a cherry on a cake. You cannot wake out of trauma, same way as you cannot simply walk away from smoking or alcohol abuse, and ignoring this seems very dangerous when our whole online presence becomes a “substance” for some people. Stopping abuse and healing in that case would also mean disconnecting from huge parts of social life and losing access to community.
Social networks take existing complex unsolved problems in our society, and dial them up to 11, with zero intention to design around the problem or take responsibility. Aligning incentives bottom up just does not work for these kinds of situations.