Maybe it's this is an overdramatic analogy, but this approach is reminiscent of a standard playbook used by a new tyrant when they come to power: Claim to be acting for the greater good and populace as a whole. Decapitate leadership of existing institutions that resist, install willing collaborators in their places, do this in the name of the good of populace even though it's that "good" that the decapitated were attempting to preserve.
One difference from the above is that the leadership is existing & simply turning tyrant. Otherwise the dynamic in Reddit is not completely dissimilar from that of any society: There are leaders at the top, sure, but the governing of that society-- and much of its value-- is derived from the consensual implicit social contract between those at the top and everyone on every level beneath that.
Can Reddit survive if such actions prevail? Maybe, but other social platform have failed for lesser reasons. And between Reddit and Twitter, there hasn't been a time in more than a decade that could give a rapid acting disruptor such a ready opportunity to sweep in and clear the slate of existing platforms that have lost the plot on what makes them useful and valuable.