http://lainyubrp2aabmxhepbttfdbl53dct2inqifs42buvpf6w44uiitbeqd.onion/blog/matrix.html
Majority of admins just disable that option, and all messages are stored unencrypted across the federation, there's no magic. E2EE is achieved in p2p chats and small groups only by invite. There used to be some problems with encryption, but after a while, the whole thing became stable, and I haven't seen funny "Message cannot be decrypted" in a long time.