Karma was originally visible raw upvote / downvote tally. Reddit just obscured the upvote and downvote numbers to discourage manipulation for karma.
Limiting participation based on karma didn’t happen for a long time. By the time some huge subreddits took that step, it (or some other gatekeeping) was necessary to filter a lot of malicious users.
That description is very fair. Hopefully as Memmy and other Lemmy apps progress, we will have more and easier moderation tools for users (rather than relying on admins).