From a food safety angle the flakes themselves are not a big hazard. They are inert and most pass through. real concern is that once the base metal is exposed it oxidizes and sticks worse which means more scraping and faster failure.
Do not pick at the edges. If you notice a loose flap you can gently remove what is already detached so it does not end up in dinner, but avoid digging. Let the basket cool before washing to reduce thermal shock. Keep temps moderate for most cooks and avoid long dehydrate or reheat cycles that bake the empty coating. Use parchment with holes or a reusable liner to separate food from the worn area and you will extend its life a lot for very little money.
