As a UI developer, that’s always been a gripe because I put a lot of effort into making them look good and scale properly, etc. When I see 60-70% or more accounts sporting the default avatar, it makes me wonder why I even bother.
You could just do those autogenerated things instead of a static image if they haven't set one. Like, hash their username and use the bits of the hash as an input to some function that procedurally-generates an image. Makes it easy to visually-identify users without needing them to go out and manually create an avatar.
I don't really care much about the visual appearance myself, but I did want something unique to make it easier to visually-identify my posts for other users. Humans can identify color in their visual field in constant time, so having different colors for different users is helpful. I plonked "wave swirl"---the first thing that came to mind---or something like that into Stable Diffusion 1.5, got a picture of a wave, haven't touched it since.
EDIT: For a good example, I always easily identify @Kolanaki@yiffit.net comments, as he's got custom colored Unicode in a display name and a custom avatar and custom background. I don't care enough to go do that myself, but it does highlight the fact that it can be useful for rapidly-identifying people in a conversation.
For those who can't see avatars, he looks like this in the Lemmy Web UI:
I'll add that I don't personally really like the display name functionality, because I need to refer to people in text using "@" syntax---as I did above---by their real username and it makes it slightly more obnoxious to get that, but I do have to say that it does help make users visually unique.
I think that my ideal for user identification would be maybe some sort of procedurally-generated flag as the default. Those are designed to be readily-identifiable at a distance already. Like, use the hash bits to choose one of several different groups of flags (triband, etc) and bits to choose the color of various elements in the flag. If one flag isn't enough to consume all the bits in the hash, maybe do two side-by-side, etc.
EDIT2: Hmm. Now I kind of wonder if that should be done client-side, because it could let the viewing user theme what they're seeing. Like, dark-mode people don't have to have bright flags, if someone wants a specific theme they could use that (a string of different colored cats in different poses), etc.
EDIT3: And I loathe the fact that the Lemmy Web UI by default permits animated avatars. I think I disabled animations somewhere in Firefox specifically because of the people on here using animated avatars. I think that not putting the kibosh on that was a huge mistake.