regardless of whether something like this may cost money, how should the technical implementation work when it comes to moderation. and at the same time be decentralized.
That's a really good question. It's easy to ignore or dismiss the moderation side of things on the basis of free speech. I think there are a few possibilities that depend on the type of social media platform.
If you take a look at LBRY, the blockchain platform is completely decentralised and unmoderated so anyone can post any content. The web based Odysee is a window to the LBRY platform and moderates the content it shows based on its policies. In an ideal future, any aspiring editor should be able to deploy their own Odysee-like website with their own moderation policy and users can choose which they use. This model might work for a decentralised version of twitter - in fact for anything based on public posts.
A decentralised Facebook probably doesn't need a platform wide moderator since users are in control of who can read their posts and communities can self moderate by arguing, unfriending, deleting posts, deleting comments etc.