Mods and versions used

Minecraft 1.16.1
Fabric 0.8.9+build.203
Lithium 0.5.0-rc1
(Carpet Mod 1.4.0)
(Fabric API 0.14.1+build.372)
(Not Enough Crashes 1.2.4+20w17a)

Reproduction Steps

1. Create a new Superflat world. Use the Void preset for best performance.
2. Set your spawn point where you initially spawn (/spawnpoint).
3. Summon 5 evokers (/summon evoker x5). You can instead activate a repeating command block with the command /summon vex ~ ~ ~ {LifeTicks:20}.
4. Give yourself max healing (/effect give @p instant_health 1000000 22).
5. Switch gamemode to survival.
6. If Carpet mod is installed, fast-forward the game with /tick warp 72000.
7. The server will crash after a few minutes.
8. If Not Enough Crashes is installed, click through the crash screen.
9. The game will exit to the multiplayer menu with "Internal exception: java.lang.StackOverflowError".

Crash Report File

https://gist.github.com/James103/e35b958585c3700722edfb700c0d0e8e

Additional Information

The crash does not occur without Lithium installed, and Not Enough Crashes tells me that Lithium is a possible cause of the above crash.

In my case, the world on which the game crashed is hidden from the world selection screen due to java.nio.channels.OverlappingFileLockException until you restart the game entirely.

I added the corresponding latest.log from a more recent reproduction of the crash. Several hundred lines of sound pool warnings were stripped to reduce the file size.

Is there a "Entity left loaded chunk area" in the log just before the crash?

Not fixed yet. Game generates additional crash files: crash-2020-07-25_07.42.22-server.txt
Same error as above. Reproduced by running the following commands in succession:
/summon villager ~ ~ ~ {NoAI:1b}
/effect give @e[type=villager] resistance 1000000 5
/summon evoker
(if Carpet Mod is installed) /tick warp 72000

Fixed on the 1.16.x/dev branch. You can either build lithium yourself or wait for the next release. Thank you for reporting this bug. The steps to reproduce were essential, I was able to locate the problem with your help.