Van Waterfox had ik nog nooit gehoord...

At this point, there is no built-in setting to change the spacing of menu items.

Unofficial Community-Supported Workaround

Firefox users can modify the user interface of the browser using custom style rules. This involves setting up a userChrome.css file. If this is your first time, make sure to set aside 10 quiet minutes to work through it. 

(For anyone who already has a userChrome.css file set up, you just need to add the rule under (A) to your file.)

Menu Spacing

(A) Select and copy the following style rule code

/*** Tighten up drop-down/context/popup menu spacing ***/

menupopup > menuitem, menupopup > menu {
  padding-block: 4px !important;
}
:root {
  --arrowpanel-menuitem-padding: 4px 8px !important;
}

Some users consider that 4 pixels of space above and below items is still too spacious and prefer a lower value. For example, for 2 pixels of space, change 4px to 2px in both rules. Check the screenshot illustrating the differences between these amounts of padding for reference. (Keep the 8px as it is, that refers to left side and right side padding.)

(B) Generate and download a userChrome.css file

Open the following page and paste the above rules into the editor, replacing the sample rule:

https://www.userchrome.org/download-userchrome-css.html

Then click "Generate CSS File" and save the userChrome.css file to your computer. (See second attached screenshot)

Use the downloads list on the toolbar to open the downloads folder directly to the new userChrome.css file. (See third attached screenshot)

Minimize that file browser window for later reference.

(C) Create a new chrome folder in your profile folder

The following article has the detailed steps for that (#1, #2, and I recommend #3)

https://www.userchrome.org/how-create-userchrome-css.html

I have videos for both Windows and Mac in case the text is not clear.

(D) Move the userChrome.css file you generated in Step B into the chrome folder you created in Step C

(E) Set Firefox to look for userChrome.css at startup -- see step #6 in the above article.

The next time you exit Firefox and start it up again, it should discover that file and apply the rules.

https://www.macfreak.nl/hardware-macintosh/wat-is-het-hoogste-goed-werkende-os-voor-mijn-imac-4-1/msg392876/#msg392876

Verdraaid @dolby: van Waterfox had ik nog nooit gehoord- en ik heb anders al een hele collectie aan browsers, hoor! Wat is daar speciaal aan?

Jouw geheugen is blijkbaar nog beter dan het mijne.

Firefox 95 for Windows and Mac introduces RLBox, a new sandboxing tech
The update also enables Firefox 94's Site Isolation by default.

Mozilla has released the latest version of Firefox, Firefox 95, for Windows and macOS. It's available now for all users on both platforms.

The Firefox team says the new macOS version reduces CPU usage during event processing and that power usage is reduced while streaming video from sites like Netflix, "especially in fullscreen." macOS users will also get a faster content process startup and will enjoy memory allocator improvements for better overall performance.

On both macOS and Windows, Mozilla has "improved page load performance by speculatively compiling JavaScript ahead of time." There's also a way to move the picture-in-picture toggle button to the opposite side of the video on both platforms, plus a handful of fixes.

But those optimizations and tweaks aside, Firefox 95's best enhancements have to do with security, as RLBox is now enabled on all platforms. Mozilla published a detailed blog post explaining what RLBox is and how it works, but the quick summary is that it's a new sandboxing technique that isolates potentially problematic code in WebAssembly and protects users from threats.