Facebook absolutely could remain a going concern while dealing with all of these problems, the problem is that they would be spending money to lose money.

One of the more perverse aspects of risk prevention is that riskier customers are often way more lucrative. It's kind of inherent to the notion that markets price risk into transactions. The thing is, illegal behavior is also just a particular kind of risk: if someone wants to sell nudify apps or scam old people, Facebook could conceivably be on the hook[0] for damages if they're caught. And in a sense, a risk premium is just a fancy kind of bribe: if Facebook won't take my ads because they think they're too risky, then I'll just pay more and more until Facebook accepts them.

With illegal behavior, we hope that we can make the punishment high enough that Facebook refuses any conceivable risk premium the perpetrators of that behavior would be willing to pay. The problem is that Facebook is really desperate for any increasing growth story, and when you're too big to fail, your growth story is to drip-feed enshittify your stack. Increasing tolerance for illegal behavior is downstream of this: you cut enforcement, tell them to automate more, they become easier to bypass... and you make more money. Because it turns out all that risky behavior... is only risky for normal people. Facebook can launder[1] the risk away and make a tidy profit.

[0] Do not tell me about CDA 230, I was there when the old magic was written.

[1] See also, HSBC turning themselves into a literal money laundering operation.