It stops bot FARMS from being feasible.

If preventing Jimmy Bumfuck from spinning up a couple sock puppets is your fear, yeah, PoW systems don't help. But those are rarely the problem.

For a phishing scam or astroturf operation to be worth it, you need tens of thousands of accounts all running the same script. Those get filtered hard by PoW systems.

Phone validation works just as well, and stops Jimmy Bumfuck from making sock accounts. But now every user must be stapled to a phone number. Maybe that's a worthwhile trade to you, but it sure doesn't seem to be to everyone replying to you.

Nah bro, you are.

It's ALSO possible to generate virtual phone numbers for a small cost.

Using a cryptographic PoW is a different small cost.

Either way, it only takes a small cost to prevent mass bot registration.

You're treating processing power and time as if it is 100% free just because it can be done in a VM. But it doesn't matter if it is a VM. It is still going to require at least some certain threshold of processor time, and that processor time has a real cost. For the kind of place that can just spin up thousands of VMs and use it to do massive bot registration... they could just be mining bitcoins instead.

It's not just whether you can do this. It's how much value it has vs what ELSE you could be doing with the time and energy. A Signal account is already worth vanishingly little as a spam tool, they just need to give it enough of a cost to make it not worthwhile.

It makes bots more expensive to create, therefore fewer will be created.

By that standard, whats to stop people from just getting more phone numbers? Its just an additional cost.