Blog post by Christine Lemmer-Webber, co-editor of ActivityPub: https://dustycloud.org/blog/how-decentralized-is-bluesky/
The likely answer to this is that there will always have to be a large corporation at the heart of Bluesky/ATProto, and the network will have to rely on that corporation to do the work of abuse mitigation, particularly in terms of illegal content and spam. This may be a good enough solution for Bluesky’s purposes, but on the economics alone it’s going to be a centralized system that relies on trusting centralized authorities.
Let us know how it goes, really curious to see how much an enthusiast can self-host!
Coming back to give you that update, I got so close but I'm stuck with trying to figure out the feed generator and I think I might be about to give up and just host the PDS. I'm sure its possible but my knowledge isnt great enough to finish this I dont think.