Fly (to my understanding) at its core is about edge compute. That is where they started and what the team are most excited about developing. It's a brilliant idea, they have the skills and expertise. They are going to be successful at it.
However, at the same time the market is looking for a successor to Heroku. A zero dev ops PAAS with instant deployment, dirt simple managed Postgres, generous free level of service, lower cost as you scale, and a few regions around the world. That isn't what Fly set out to do... exactly, but is sort of the market they find themselves in when Heroku then basically told its low value customers to go away.
It's that slight miss alignment of strategy and market fit that results in maybe decisions being made that benefit the original vision, but not necessarily the immediate influx of customers.
I don't envy the stress the Fly team are under, but what an exciting set of problems they are trying to solve, I do envy that!