It's a forced meme where some psychopath called Tioga060 started a coordinated campaign to label paragraphs as a Reddit shibboleth, even though the use of paragraphs have been around since the dawn of the site as a basic readability technique. He (along with redditors on 4chan and newfag autists) made it semi-plausible by pointing the finger at Reddit markdown formatting and newfags fell for it en masse and they've been using the phrase in a desperate attempt to fit in. Back in the day, it was blockposting like this that would get you told to fuck off. Look up the phrase in any 4chan archive and you'll see it started in 2016 with one or two mentions in 2015.
There are also people who start screaming "REDDIT SPACING" when they don't actually have a counter argument so they hope to derail the discussion by using the phrase against properly formatted long form replies as a wedge to start throwing ad hominems. I've been on this shithole since 2006 and people have been using paragraphs from the beginning.
My personal theory is that linebreaks after only a single sentence or two sentences are actually increasing because of the massive increase in phoneposting, because on small screens a single sentence can look like a whole paragraph.
tl;dr calling people out for reddit spacing proves you're a newfag zoomer from reddit trying to fit in. It was invented by a psychopath who got banned from subreddits who actually uses Reddit and knows how Reddit's CSS works. Oldfags that wouldn't touch plebbit with a ten-foot pole wouldn't know what reddit spacing is. It's time to go back to where you came from, redditor.