Most Mastodon, Friendica, Calckey instances accept donations.

It is likely that kbin/Lemmy instances will likely follow the same model.

Advertising would not work on the Fediverse as the adverts would be blocked by other instances so the spread would be very limited so not attractive commercially.

That is one of the beauties of the federated model.
Also, as there is no algorithm or data about user interests there's no scope for advert targeting which advertisers would want.

The whole ethos of the #Fediverse is anti commercial.

This! Ads aren't really good and have become malicious, manipulate and just bad in all kinds of things.

I'd rather have the instances communicate that they X amount of money for the moderation + servers costs. Since the communities on an insurance are closely connected, they'll rather be happy to do that.

Add regular donations via patreon and it's solved. To make transfers even more neutral, you could also accept cryptos for payments.

the same can be said about instances with millions of users uploading and downloading millions of images and videos. I'd love to follow along and see that journey would go. I mean, I hope I'm wrong but I just don't see it being sustainable if you want to compete with reddit for example.