I imagine it like friend requests between communities. E.g. x@instance.a, all-about-x@instance.b and x-is-great@instance.c could send each other friend requests and merge into one federated meta-community about x. Then if one instance goes down the other two are still there to keep the meta-community alive.

The nice thing about manual federation is that they don’t have to have exactly the same name, and the mods can keep malicious or troll communities out.