About centralization:
Absolute centralization does not normally happen in the free market. First, for centralization to happen at all, there has to be large scale advantages. If there are, centralization will start to happen, but there are at least two counter-forces (from the top of my head). The first is the cost of administrating a larger business. You need more layers of administration, and administration is costly and ineffective. Also, with few competitors, the whole business get complacent and start to deteriorate, making room for someone else.
The other point is the risk factor. Say the business centralizes, the best companies grow, steadily increases productivity, and at some point there are only two left, one of them marginally more effective than the other. The least effective of the two then have the choice to wind down, forsaking some of the capital in the process, or sell itself to the other, but for a price that may be low because the other has the upper hand, or, the third option is to continue grinding on with slighly lower profit, and then hope that the other makes a mistake. It is easy to make mistakes when you have optimized fully - bitcoin price move against you - power price, space rent, wages, some regulation, whatever. And the nature - a storm taking out power for a day and so on. Suddenly, the other company is number two and you are number one. The arrest of centralization will probably start far earlier, I believe we will have say twenty large operations, and hundreds of smaller, professional operations spread around the globe. And I mean mining factories, not pool operators. Those can be regarded as service companies for the miners, with their own centralization dynamics.
Absolute centralization does not normally happen in the free market. First, for centralization to happen at all, there has to be large scale advantages. If there are, centralization will start to happen, but there are at least two counter-forces (from the top of my head). The first is the cost of administrating a larger business. You need more layers of administration, and administration is costly and ineffective. Also, with few competitors, the whole business get complacent and start to deteriorate, making room for someone else.
The other point is the risk factor. Say the business centralizes, the best companies grow, steadily increases productivity, and at some point there are only two left, one of them marginally more effective than the other. The least effective of the two then have the choice to wind down, forsaking some of the capital in the process, or sell itself to the other, but for a price that may be low because the other has the upper hand, or, the third option is to continue grinding on with slighly lower profit, and then hope that the other makes a mistake. It is easy to make mistakes when you have optimized fully - bitcoin price move against you - power price, space rent, wages, some regulation, whatever. And the nature - a storm taking out power for a day and so on. Suddenly, the other company is number two and you are number one. The arrest of centralization will probably start far earlier, I believe we will have say twenty large operations, and hundreds of smaller, professional operations spread around the globe. And I mean mining factories, not pool operators. Those can be regarded as service companies for the miners, with their own centralization dynamics.
Bitcoin exists in no way, shape, or form in a 'free market' nor is there any realistic way that it will either in a socio-economic and political climate similar to today's or in almost any likely evolutionary or revolutionary increment of it. This makes all of your theory based assertions and pipe-dreams useless. Worse than useless actually. All you have to do is open your eyes and look at almost any aspect of reality these days to see this.
Laissez faire strategies are very much to my liking and are an ideal in a lot of ways to me, but they simply do not work when one is under attack, and distributed crypto-currencies very much are and will be much more so going forward. I (do) lobby hard for an active and pro-active defense and at least maintaining the ability to go on the offense when it makes sense strategically.
