This is how it is supposed to work, yes. However. i will say one suggestion going forward might be some sort of voluntary community sub-federating. The idea is that communities from different instances that are considered similar in topic enough to be under the same umbrella would federate or group with each other. A person who subscribes to one might see content from other communities that have voluntarily opted into this feature. It would connect the scattered communities of topics while also allowing these communities to “defederate” on their own from other communities of the same topic, in the event that malicious communities attempt to joing where they do not belong.

This could also be given to the user, the ability for users to group their own subscriptions together, but this would put way more work on the end user and may not be as intuitive.

For example, I am subscribed to one Silent Hill community, and I think I am the only member beside the mod, with no posts. It would be nice if I could see content from other Silent Hill communities in that feed.