Mobs stop spawning in farm when a second player joins the game. PaperMC 1.20.2

Hi folks!

I build a classic "platforms surrounded with trapdoors" xp farm.

The spawn rates are quite nice but once a second player joins the game, spawn rates drop to zero immediately.

If the player goes more than 120 blocks away, the spawns start again but at an abysmal rate.

Does anyone know what the problem seems to be? The farm is high in the sky 128 blocks above the ocean so nothing can spawn except there.

I might have read something about mobs spawning between them if multiple players are on the server. I suppose I could check that.

Thanks for reading. Have a good one.