@catonano I guess similar to Twitter; you don't see that user's posts in your timeline - even if someone re-toots them.
If you tick the "no notifications" option too, it'll mean that you won't see them in your notifications.
Different from blocking because blocking will mean you see no content from them, and they can't see yours. Muting is one way.
Seems somewhat dated though, it's a year old - but, strangely, I could not find a better explanation of the mechanism.
@catonano A link to the whole archived FAQ: https://web.archive.org/web/20170517104957/http://mastoguide.info:80/Pages/FAQindex.html
@catonano Got a response from upstream that explains how it works: https://github.com/tootsuite/mastodon/issues/7790#issuecomment-396557684
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