I don’t really think ICANN should be based anywhere or really have any say, or I guess even exist at all. I’m a strong believer in a decentralized DNS system not controlled or designated by a single, all powerful entity. With how important it is and how much breaks if it gets compromised either by outside forces, or by internal corruption, it makes sense that something like this shouldn’t be so centralized and vulnerable.
I would encourage that, but if your instance doesn’t defederate them you may have to go a bit farther since you’ll still get replies from lemmy.ml users, as users are not blocked as part of this functionality. And that is by design, it’s not meant to act as a replacement or alternative to defederation, it’s meant to act as an alternative to blocking all communities on an instance.