Element does not fetch any message from their servers in general. If you use a server hosted by Element and don't disable encryption, e2ee encrypted messages will be fetched from their servers.

What is "it" that in your opinion should reduce the users privacy?

> I don't know what else to argue about here.

I don't know what you are arguing about right now. What I know, is that I have disproven your original thesis (visible messages right after login through a password is not possible with e2ee) by explaining how it works and providing an example that has put that concept into practice.

If you feel there is anything to discuss, or if you have any further questions, don't hesitate to respond though.

I'll add link that adds technical Implementation details, in case you are interested: https://matrix.org/docs/guides/implementing-more-advanced-e-...