Technology

It's possible, but funding changes at scale.

For example, more people using federated protocols like Mastodon or Lemmy are going to be early adopters that care more about underlying technology and have stronger ideological views about online platforms, compared to, say, your average Facebook mom.

So of course, they're going to be more likely to donate. Once you scale outside of those groups into groups of people who don't care as much, and are less invested in the technology, you get less donations.

Sites can work on donation models (again, see Wikipedia) but it's much more difficult to have such a system stay afloat than one where monetization is much more heavily required, and thus generates more revenue.

It's not ideal, but it's also difficult to have such a system work otherwise in many cases.

and do not have to deal with the added tasks of ads and trackers commercial sites use.

They use these things because it makes them more money than it costs. If ads and trackers costed more to implement than not having them, then they wouldn't use them in the first place.

You could pretty easily build a youtube like site around it.

PeerTube exists if you're interested, by the way.

Sites can be distributed, the technology to do that has existed since the mid 90’s.

Certain aspects of sites can be distributed, but others can't as easily be. For instance, you could have a P2P federated network where every user of, say, Mastodon, helps host and redistribute content from posts, but that's not how these systems are built right now, and they'd have difficulties with things like maintaining accurate like counts.

It would be ideal if they could be built in a way that removes the need for a central platform in the first place, and can run on general-purpose devices, and thus doesn't carry costs that require monetization, but because they aren't built like that, they will eventually need to monetize as they scale up. Unless they change the entire underlying technological model of these federated platforms, they will inevitably need to monetize if they gain enough users outside the (relatively speaking) small bubble of dedicated users that can easily fund a platform through hobby money and donations.