I thought messenger was end-to-end encrypted, at least according to Facebook. How were they able to hand over the chat logs? The messages should be encrypted with a key that is itself encrypted with user's password, which Facebook doesn't store.

What am I missing?

Actually that page suggests that they can't access it. They'd never passed the security on it if that page was lying and they don't encrypt it. Clearly there must be some kind of mechanism they can use to decrypt it for law enforcement. The technicals of that are what I was actually interested in from my original comment.

EDIT: Oh my God I just figured it out. It's not enabled by default. You have to explicitly turn it on per conversation. That's terrible

So what does deferedating from them do for us? I wasn't seeing their content anyway because it wasn't popular enough to end up on all.

Does it have any practical effects for fmhy users?

I personally joined this instance because so many other large ones have massive federation lists. So if the only effect of defederating is to send a message, then I'm not sure I'm for that.

Your admin has actually defederated from quite a few instances. Uncensored it is not.