Two of my main grievances with the communities both have to do with identity:
ActivityPub as implemented in the wild doesn't make it easy to migrate your identity between instances. This has caused endless problems and drama with instances shutting down. You also have to use multiple accounts if you want to interact with different formats, ie Mastodon vs Lemmy vs PeerTube. As a user that seems pretty ridiculous. You're losing a huge portion of the advantages of federation. IMO a better model would be for you to create a single account on a universal ActivityPub server that supports all data types. Apps like Mastodon would act as clients, not servers. My reading of the specs makes me think this was the original intention (there is a client to server "C2S" protocol), but then Mastodon got big and no one ended up implementing the C2S protocol, treating Mastodon as the de facto C2S API.
Note there is some work to create these universal servers[0], but I wouldn't hold my breath on Mastodon/Lemmy/etc implementing the C2S protocol.
As for nostr, private key management is a complete non-starter for identity, barring some major new breakthrough. DNS is the pragmatic solution to identity.