The benefit will be (in term, as it is not yet implemented) federation with other service, Mastodon, Pixelfed etc.., you could comment and see a loop from your Mastodon account without leaving the app nor having a Loops account.
It's only private by default to hide users that only watch content and don't post (better for privacy and not being harassed by bots etc..) That's at least my take on it, I wasn't even aware your profile was private by default
The code is open-source though, it took some time but the idea was to open-source it from the start, the developper just wanted to make sure it was good before open-sourcing it, and the server is available here now: https://github.com/joinloops/loops-server