Keep in mind that the entities-in-viewing-range scales quadratically with players. 10 players in view distance is (at 20 ticks per second) 180 packets per second *per player*, or ~2k pps on the server. 100 players, ~200k pps. 1000 players, ~20m pps. All on a single Java thread, hence why Minecraft typically performs better on high clock-speed low(er) core count CPUs. Folia splits the load for the world into multiple threads, but only on a per-region basis, with each 512x512 being (potentially) on a different thread.

EDIT: Correction, as doctor_phil points out that's a quadratic scale not an exponential scale. Derp.