As a newbie, having some way for a community to democratically replace a moderator definitely sounds like it would be an improvement over most (all?) non-federated social media services, but I think there needs to be some kind of election framework for community leadership positions in general, and that would be how bad moderators get replaced. At the very least, I hope any voting would use the STAR method.
Sorry for the late reply. STAR stands for Score Then Automatic Runoff. The idea is every option is scored by voters from 0-5 stars, and the scores are added up from each voter to get the top two scoring options. Then those two options are ranked according to which was preferred (scored higher than the other) by the greatest number of voters. There’s a website about it, along with entries on Wikipedia and Ballotpedia.