Yea, I know how it works. Different groups of people fork (or just directly use) the open source wallet and stack to power their community (e.g. one in El Salvador, different one in Costa Rica, different in Venezuela).

The leads in each community hold the sats in multisig. Galoy provides help and support, but Galoy doesn't own the keys for each community. That's what I meant by federated. What did you understand by federated?