Yes, it's possible for Fediverse apps like Fedilab to support end-to-end encrypted DMs. We plan to write a FEP where actors expose their public keys in their profile. Each app would manage encryption locally while servers act as relays. The security model is the same as Signal: private keys stay on the device, servers only see encrypted data.
@appsFedilab Apps You can expose public keys with FEP-c390: Identity Proofs. Identity proofs are more secure than simple public key profile fields because they make it harder for a malicious server operator to replace a client-generated key with his own key.
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