Strictly speaking it's not a walled garden for not being compatible with activitypub, it's just a different protocol. The infrastructure is open source, but some critical parts (the relay) are still run only by bsky pbc with no clear way to switch to a competitor. But anyone can host an account on their own server and connect to the network
It's like a milder form of how git is open source but GitHub is a centralized service. And all the nice non-git social features such as stars and issues and discussions are proprietary.
For the bsky protcol the extra stuff is (mostly) open source too but it'd still be very expensive to build a reliable full featured alternative so 95% of people just default to GitHub/bsky.app