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Warning: lemmy.world just got hacked
(beehaw.org)
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Read the post again. It was specifically mentioning viewing lemmy.world communities, which is not possible through beehaw.org due to defederation. All you would see is the content before defederation.
Not possible with a beehaw account. But we know many of us may have accounts elsewhere.
It's also possible that Beehaw's instance is vulnerable to the same XSS attack.
No user data like credentials gets transfered. Everything between instances is done with bot like helpers that do the data transfers.
That would require your device to get hacked, not just the server.
As for privacy... there is really little of that on Lemmy or the fediverse as a whole.
Why would a "foreign" instance need to know my credentials from my local instance just to allow me to browse that foreign instance?