it is kinda sad, but it's been a long time coming. reddit has just gradually gotten worse and worse over the years, it's far from what it used to be.
reddit used to be different, used to be much less corporate than any other traditional "social media" website, more like the old internet. i think reddits gotten way too greedy and money-driven, and has lost sight of its core users and why they used the site in the first place.
i think lemmy so far is doing an amazing job capturing what reddit used to be like back in the day. it really is a breath of fresh air imo, especially compared to how the internet is today in general.
The data is encrypted, so not even Mozilla can see the data you sync, and Mozilla is also generally pretty trustworthy, so in terms of privacy, its fine.
For passwords, its probably not as secure as trusted dedicated password managers like Bitwarden. I just use Firefox for syncing bookmarks and sometimes tabs, and Bitwarden for passwords and things like that.