Some people use no folders, saving everything to root. I've just started experimenting with this, using a rigid file naming system to impose some semblance of organization, and I'm rather enjoying this. However, for large vaults, this means a lot of scrolling when not using other means to find a file (Quick Switcher, various searches, note-to-note navigation (note hopping)).
Proposed solution
This problem could be mitigated by adding clickable letters next to files—I think ideal placement would be on the left, with a space separating the letters from the file names. An example is the iOS contacts app:
