Yes, for example go to https://infosec.exchange/explore
I see the top post as https://infosec.exchange/@nocontexttrek@mastodon.social/113433063621462027 and the image is https://media.infosec.exchange/infosec.exchange/cache/media_attachments/files/113/433/063/582/671/258/original/71da3801e4e4f08c.png
The link is to the original on https://files.mastodon.social/media_attachments/files/113/433/062/676/773/993/original/f828afef5cc7ed1c.png but when you click image the javascript loads a modal with the local cached version (same image as the thumbnail that infosec.exchange loads.
There's lots of different codebases across the fediverse so perhaps some hotlink, but local copies is the default.
Ok, so Lemmy doesn't cause the same amount of duplication, but I'd still argue that dedupe is valuable: it saves on hosting costs (your costs, in this case) and users will get a small advantage in having slightly higher cache hits.