I haven’t checked around since the reddit API fiasco, but there were unfederated Lemmy instances. Hexbear used to be unfederated (their code diverged before federation was working IIRC) and it was the largest of all instances. Even without federation, it’s a viable, actively developed link aggregator.

and wasn’t it revealed that that Trump’s garbage dump was running defedded Masto?

Gab is also a Mastodon fork, which was originally defederated before being blocked from most instances and bullied by the remaining freeze peach instances, so they mechanically removed the federation code.

I’ve also heard some special interest communities on Mastodon intentionally defederate from the broader network for privacy reasons.