It doesn't use Fabric under the hood, where did you hear that?

> Also, what makes you think it’s the most popular server?

Because it's the only server software that can actually scale and support a long-term server with feature and bugfix stability. Its popularity bears out in what hosting companies say people are most commonly using. Though I'm not sure if there is a specific publicly published statistic to point to to prove this - there is bStats global stats, but it is biased towards the Paper ecosystem.

Fabric is getting close with certain optimization and bugfixing mods, but it's still not there. Paper has a checklist of what optimizations and fixes must be included for a release to proceed, whereas Fabric ecosystem is still a hodgepodge of different things that are only available on specific Minecraft versions.