Librewolf is, to me, the way better alternative as this is really in the FOSS mindset : a tool for everyone to use and by anyone to contribute. Seeing their plateform alone (Lemmy/Matrix/Codeberg, they also have a reddit community it seems) you can already see this is an other world than Waterwolf's bluesky/reddit/github. To be fair I can understand the SNS part but the github is a big redflag to me.
As usual I can see people that are very probably sincere in their goals not realizing the way they are going will lead to the usual enshitification: company focus, brave dependency, etc.
I note that Waterfox seems to legally originate from UK and it is refreshing to have an ecosystem that is not centralized in 1 country : for the sake of everyone it is better not to rely to much on 1 legislator (see age verification for instance).