ActivityPub and Mastodon brought new incentives into the world of decentralised communication platforms, even so far as I would call it a serious alternative to platforms like Twitter. But all efforts made by hundreds of individuals every day – administrating servers, developing software and moderating communities – have a weak spot which needs to be addressed in the near future: who has control over the underlying computing infrastructure of the Fediverse? And are users aware of the conditions?
But this topic isn’t primarily about privacy. Yes privacy is also potentially effected (but as you say not that likely), but what this is mainly about is network resilience (and also censorship resistance).
Edit: Note how it wasn’t even posted on the privacy community :p
If it comes to resilience, shouldn’t those who manage an instance worry about having a backup to upload to another provider’s server by changing the DNS record in case there are problems?
If so it is not a Fediverse problem but a problem of some administrators who naively do not follow good practices in general.