What Are Federated Systems and How Do They Differ from Centralized and Decentralized Systems?

A federated information system is a loosely decentralized architecture where independent networks, platforms, or nodes interact based on common rules without transferring complete control over data to a single entity.

These systems operate on an open protocol, with each node managed autonomously: each has its own owner, moderation rules, and audience.

Unlike centralized platforms like Telegram or WhatsApp, where a corporation owns the servers and data, a federated network lacks a single point of failure, except when one of the servers goes down. Participants in the network can access users from other nodes.

From left to right: centralized, federated, and distributed networks. Source: Mastodon.

Federated networks occupy an intermediate position between centralized and decentralized systems. Unlike Web3 architecture, they offer a compromise: trusting data to a chosen server that can be personally controlled while maintaining global connectivity with the rest of the world.

How Did Federated Data Transmission Systems Emerge?

One of the most common examples of federation is email. Gmail users can exchange messages with owners of other mailboxes like ProtonMail or corporate servers thanks to the unified SMTP protocol. Standardized in 1982, it became one of the first examples of a federated system: anyone could set up their own mail server and automatically become part of the overall network without needing permission.

In 1979-1980, Usenet emerged—a system of newsgroups where messages were replicated between university servers. Initially, it operated on the UUCP protocol and switched to the specially created NNTP in 1986.

In 1984, programmer Tom Jennings launched FidoNet—a network of BBS stations (electronic bulletin boards). They exchanged messages via modem connections at scheduled times to reduce communication costs.

In 1999, the XMPP (Jabber) protocol was introduced—an open standard for instant messaging. Any organization could set up its own Jabber server, allowing users from different nodes to freely communicate with each other.

A common feature of all these systems is the open standard instead of a proprietary protocol and voluntary federation of servers without a single owner of the entire network. However, none of them became a mass consumer product on the scale of modern centralized messengers, hindered by a fragmented user experience and the complexity of setting up one's own server—leaving their audience primarily as enthusiasts and organizations.

What Is the Fediverse, the ActivityPub Protocol, and the Mastodon Social Network?

In February 2010, Columbia University law professor and copyleft advocate Eben Moglen delivered a speech Freedom in the Cloud, calling centralized social networks "free surveillance." This speech inspired four New York University students to launch Diaspora. Raising over $200,000 through Kickstarter, the developers released the first closed alpha version on November 23, 2010.

Diaspora was built on independent servers—"pods"—administered by users themselves. By November 2011, the network had about 216,000 users, peaking at 400,000—significantly fewer than its competitors but enough to demonstrate the viability of the idea. The project remains active: version 0.9.1.0 was released in early 2026.

Simultaneously, the OStatus protocol was developed starting in 2010. It was used in GNU social and identi.ca but relied on a variety of technologies: Atom, Salmon, WebSub, WebFinger. This complexity made it challenging to implement in new software.

In July 2014, the Social Web Working Group (W3C) began developing a new standard, ActivityPub, based on Evan Prodromou's ActivityPump protocol. It had two significant advantages over OStatus:

  • solving two problems with one standard. It regulated how user applications communicate with their servers and how different servers communicate with each other. By unifying both processes, it became much easier for developers to create new projects and connect them;
  • enhancing anonymity. The protocol distinguished between public and private posts and specified to whom they were addressed. OStatus lacked this feature—everything published was automatically visible to everyone.

On January 23, 2018, ActivityPub became an official W3C recommendation. However, its survival was significantly bolstered by Mastodon—a microblogging platform based on OStatus, launched by developer Eugen Rochko on October 6, 2016.

Source: Mastodon.

By December 2017, the platform's developers added support for an early version of ActivityPub, for which W3C extended the working group's deadlines twice. Without this implementation, the protocol risked remaining a theoretical standard, like its predecessor.

After Elon Musk's acquisition of Twitter on October 27, 2022, Mastodon experienced a massive influx: its monthly audience grew to a peak of 2.6 million in November 2022. According to the platform's dashboard, on July 8, 2026, there were 727,000 monthly active users across 7,800 servers.

Thus, under the previously established term Fediverse, all independent but interconnected ActivityPub platforms came together: Mastodon for microblogging, PeerTube for videos, and Pixelfed for photos. Major players later showed interest in the protocol: Tumblr, Flipboard, and Threads from Meta.

What Is Matrix and How Does It Differ from Other Federated Protocols?

Matrix is an open protocol for messaging, voice, and video communication, founded in 2013 by Matthew Hodgson and Amandine Le Pape. In June 2019, the release occurred, and the non-profit organization Matrix.org Foundation was established to curate the standard. The reference server became Synapse, and the main client is Element.

Unlike XMPP and ActivityPub, Matrix is designed for resilient federation. The core principle of its architecture—homeserver—allows registration on one of the servers, where communication occurs in "rooms." Users from different "homeservers" can simultaneously join these rooms. Nodes synchronize event history in real-time, with none considered "primary."

A room is a distributed object, with a copy stored on each participant's server in a specific chat. When a user sends a message, they do not "forward a letter" but perform a database write operation with an instant copy on all chat servers.

Key features of Matrix's resilient federation include:

  • directed acyclic graph (DAG). Each new message is tightly linked to previous ones using hash functions, forming a DAG. Servers constantly verify this graph against each other;
  • automatic merging during failures. If server A disconnects from the internet for a week, users on servers B and C continue to communicate. When A reconnects, it requests missing elements of the graph from its neighbors. Thanks to mathematical algorithms, Matrix automatically "stitches" the history together without user involvement.

Encryption in Matrix is handled by the Olm protocol (for one-on-one messaging) and Megolm (for groups). They are based on Double Ratchet principles, like in Signal, providing end-to-end encryption.

A significant distinction from WhatsApp or Telegram is the open-source nature and bridges to other networks: Slack and Discord.

Who Uses Matrix and What Are Its Alternatives?

The flexibility and high level of security offered by Matrix are in demand wherever complete control over infrastructure, privacy, and data routing is critical.

Initially, Matrix was primarily a large network for everyday users, enthusiasts, and privacy advocates. Hundreds of thousands of people worldwide use public servers daily as a secure alternative to WhatsApp or Telegram, escaping corporate surveillance, algorithmic scanning, and the risk of blocks.

Once the architecture proved its reliability on a mass scale, corporate and governmental structures began to adopt Matrix:

  • government and defense sectors. The French government deployed a national messenger, Tchap, based on Matrix, uniting about 350,000 civil servants. The German armed forces use their own client, BwMessenger, for communication among 100,000 military personnel. Additionally, NATO and the U.S. Space Force utilize Matrix-based solutions (via the Element client) for secure communication;
  • healthcare. The national organization Gematik launched TI-Messenger in Germany—a specialized federated network for medical professionals, allowing secure exchange of patient records and medical confidentiality;
  • IT corporations and Open Source. Mozilla switched to its own Matrix instance in 2020, abandoning outdated IRC. A similar choice was made by Automattic (the parent company of the WordPress ecosystem), which implemented a federated network for corporate communication, as well as the international developer community KDE.

The main motivation in all these cases is the pursuit of digital sovereignty. Large governmental and commercial entities want to comply with strict local data protection laws and avoid dependence on algorithms, monetization, or blocking by centralized IT giants.

Source: Element.

Despite Matrix's dominance in the corporate sector, it is not the only player in this market. It faces several strong competitors in the broad field of decentralized protocols, each offering its approach to data storage:

  • Nostr. A protocol created in 2020, conceptually lacking traditional servers and "rooms." Users publish messages on relays (relay servers), and accounts are tightly linked to a cryptographic key pair. Native integration with the Lightning Network allows sending micro-donations in Bitcoin with zero fees directly in posts;
  • AT Protocol (Bluesky). A standard initially developed within Twitter, which became public in 2023. Unlike Matrix, it is designed around the idea of portable identity: profiles, followers, and social graphs can theoretically be "taken" and transferred to another server without losing connections.