Here’s hoping they migrate to wiki.gg as Terraria’s contributors have a while ago.
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Federated wiki does not sound like a good idea, as in, all articles coming from different servers. But we don’t have to go that far; hosting a wiki is quite straightforward. If you’re already paying for hosting, you might as well just use the tools readily available. But for “fan” wiki, you’d require a strong enough core to handle that part while other contributes.
I think it would work like how it does here, where you can access/edit all the pages on independent wikis hosted on different servers with one account identity. Federation is about getting both the advantages of centralized services and independent operations (sometimes disadvantages too), and I think outside of forums, fan wikis are probably the best sites for a federation structure. After all, wikia/fandom already kinda operates like this.