There's 2 ways mastodon can scale (or not):

1. Per-server

2. Network-wide

Moderation load is per-server scaling, mostly. I'd argue that if the load gets to be too much, moderators do less moderating and people decide to migrate to other servers. That's kind of a clean scaling strategy, tbh.

However, adding servers isn't a great story. There's n^2 network connections (worst case) that need to be made to service all subscriptions. That's definitely a scaling problem, although probably addressable via an architecture inspired by gossip protocols.