From centralised platforms to decentralised governance

Western policy makers typically regulate social media through frameworks designed for large, centralised companies. However, decentralised and federated social media platforms like Mastodon and Bluesky operate using fundamentally different governance structures based on community stewardship and distributed control. This working paper argues that applying centralised regulatory models to these systems risks overburdening volunteer administrators, narrowing digital diversity, and undermining Canada’s goals for digital sovereignty.

The “fediverse” comprises a network of independently run servers, or “instances”, that interoperate through open protocols like ActivityPub. This model redistributes platform governance across communities rather than concentrating power in a single corporate authority. Mastodon, founded in 2016, is a prominent example with roughly 27,000 instances and between 10 and 14 million users. Usership across the fediverse has reached approximately 400 million monthly users, accelerated by Meta’s decision to make its Threads platform interoperable with the network through the ActivityPub protocol.

How the fediverse governs itself: Covenants

In the fediverse, trust is established through shared agreements. The Mastodon Server Covenant requires servers to maintain four conditions: active moderation against racism, sexism, homophobia, and transphobia; daily backups; emergency infrastructure access for at least one other person; and a commitment to provide three months’ advance warning before shutting down. Through this “covenantal federalism”, small units consent to a shared ethical code while maintaining the ability for users to withdraw and migrate elsewhere if trust is broken.

Why top-down moderation falls short and why bottom-up matters

Centralised platforms rely on blanket, top-down rules to manage massive, diverse user bases, often rewarding engagement over safety to drive advertising revenue. In contrast, decentralised moderation allows for context-sensitive approaches. Research indicates that medium-sized fediverse servers can offer high-touch moderation that differs significantly from centralised platforms. This model allows moderators to operate closer to their communities with manageable user-to-moderator ratios. For example, the Indieweb.social instance maintains roughly one moderator per 500 active users. In comparison, X employed only 2,294 moderators to serve the entire European Union under the Digital Services Act.

Decentralised moderation in practice: Tools, enforcement and limits

The fediverse uses tools like “defederation”, which allows an instance to disconnect from another that violates its norms. This was demonstrated when the far-right network Gab joined Mastodon in 2019. Through a combination of human moderation, silencing tools, and shared blocklists, the fediverse succeeded in containing Gab without requiring a centralised ban. Within one year, Gab had become 99.3 percent insular, with only 0.7 percent of the wider network still able to interact with it. Bluesky further innovates by allowing users to create and share moderation lists and labels, enabling moderation through shared filters rather than centralised takedowns.

However, these systems often rely on unpaid labour and unstable funding. Blacksky, a moderation service on Bluesky, operates with only 10 paid staff and depends on grants and donations. Legislative efforts must recognise these resource constraints to avoid imposing impossible compliance burdens on everyday users acting as administrators.

Canada’s platform governance gap

Existing Canadian policy frameworks, such as the proposed Online Harms Act (Bill C-63), often clash with decentralised logic. While the bill required regulators to consider platform size, its vague language could still impose heavy burdens on volunteer-run instances, such as 24-hour takedown mandates. Furthermore, the Online News Act exposed Canada’s reliance on foreign-owned platforms when Meta blocked news links entirely, causing Canadians to miss roughly 11 million news views per day. This creates an opportunity for policy to support resilient, Canadian-based alternatives like Gander Social.

International lessons from decentralised governance

Taiwan provides a leading example of how decentralised digital tools can strengthen democracy. Following the Sunflower Movement, platforms such as vTaiwan and Join were institutionalised to structure participation to identify consensus rather than amplifying the loudest voices. At its peak, vTaiwan involved roughly 200,000 participants and addressed 28 policy questions, with approximately 80 percent resulting in legislative outcomes. These cases offer reference points for Canada in considering participatory approaches to digital governance.

Recommendations

The report proposes several pathways for Canadian regulators. The Canadian Radio-television and Telecommunications Commission (CRTC) and Department of Justice should adopt a tiered, proportionate regulatory model that recognises the public interest of the fediverse and scales oversight based on platform size and risk. The Department of Canadian Heritage and the CRTC should promote cooperative compliance by supporting open-source moderation tools and community-managed blocklists.

Innovation, Science and Economic Development Canada (ISED) and Canadian Heritage should leverage interoperability and account portability to build self-governed digital infrastructure and reduce reliance on foreign platforms. Finally, the government should invest in research on decentralised moderation and involve civil society and platform administrators in policy co-design to ensure regulations reflect how these systems actually operate.