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At the moment blocking is an all or nothing proposition. 
Block someone and you cannot see their creations or profile and they cannot see yours.
With no warning and for no cause or explanation you can suddenly find yourself unable to see creations by random strangers. It can actually be a bullying tactic in itself, intended to intimidate, and groups of people can do it all at once to target an individual and bully them off the platform. 

There are constant messages in Dreams about people blocking or being blocked and to be honest it creates a toxic environment. 

I understand having the ability to block someone from sending you vile sexual messages or hate, is important, and that should definitely be retained. Blocking people from commenting on your creations would be enough for this, you do not need to block them from seeing your profile and creations completely.

There is no appeal process, so there is nothing to be done when someone blocks you. Now for most people they will probably be nonplussed by not seeing some content, especially by people that have expressed hatred for them. However when the same people who are being promoted by Mm, and run community competitions and make popular game kits block you, without any reason and refuse to respond to requests for explanation it becomes a bigger problem - especially for content curators and YouTube channel owners like myself.

Couldn't blocking just be from your end? So if you block someone you cannot see them - cannot see their comments cannot see their creations - so you are protected from hate messages etc.

Otherwise all blocking does is punish and bully people. It is being used vindictively for non valid reasons to punish or ostracise people. As it stands it is an abhorrent part of Dreams that creates drama and ill feeling, and should be looked at.