It depends what kind of instance software you're running, and what your threat model is.
Obviously if there's sensitive personal data then that should only be stored on e2ee systems, but most of what people do on social media isn't sensitive personal data.
I've gone through all the reasons for having your own server here, and most of these aren't linked to encryption:
https://growyourown.services/why-growing-your-own-services-is-a-good-idea/