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You are encouraged to self-host #XMPP but you are not required to. We try to make self hosting as easy as possible. I think it is one step above hosting your own website but way easier than hosting your own e-mail.

If you are medium tech-savvy I recommend getting your own domain and going for an XMPP provider that let’s you bring your own domain (for example: https://account.conversations.im/domain/) this gives you the flexibility to self host or switch providers later.