I disagree.Power/Threat Level is part of what makes a good villain. How can a villain be great if he can't truly threaten the heroes in any real fashion?
Part of what hurts Joker is that he posed no real threat to Batman himself, just his livelihood. He can hurt/kill civilians, destroy buildings and troll the hero, but when pressed or things didn't go his way (like with the boats not blowing up) Joker completely crumbled.
Threat level alone doesn't make a good villain.
I put joker over thanos because ledger brought that character to life, a damn near perfect portrayal of the character. That's exactly how I picture joker being if he actually existed in real life. Joker literally made that movie what it was, not batman.
Joker has always been a top tier villain in comics and it's never been because he posed a serious threat to batman, it's his ability to get inside his head and make him second guess his morals. Batman could realistically kill joker at any point but that's exactly what joker wants. If batman killed joker then ultimately joker wins.