Right that WiFi does not require a hub, but it doesn’t require a cloud either. Only if you run without a cloud you might then need some kind of hub to handle the local messages.
For example, HomeKit devices use WiFi, Bluetooth Or Thread, but everything except the voice assistant and camera cloud storage runs locally, no active internet connection required. The same Meross WiFi devices that require a cloud connection for SmartThings run just fine without internet on HomeKit. So it just depends on how the platform is designed, it’s not a technical requirement.
Matter is also intended to run locally for WiFi devices: we’ll see how that goes once it arrives.
BTW, @TAustin has an Edge Driver for Shelly WiFi switches and sensors which allows them to run locally with ST now. (The official integration is cloud to cloud.) he’s done some amazing work on the new platform.
