That's for the standard full mesh clustering, Erlang distribution can be further tuned with hidden nodes, etc. I think WhatsApp scaled clusters to 10_000 nodes[1].
I personally only run max 10 nodes Erlang cluster (on physical servers) in production, and ~ 20 on AWS for dev/testing workloads.
But I think it's better to have a federation of smaller clusters, or separate cluster per datacenter/AZ.
Erlang distribution isn't a silver bullet, though. But for 80% of cases it's enough.
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[1] Scaling Erlang cluster to 10,000 nodes
https://codesync.global/media/maxim-fedorov-scaling-erlang-c...