Have you ever heard the Lightning Network
Of course I've heard of Lightning Network, it's a trojan horse to recreate the exact same banking system that already exists:
LN is an unworkable train wreck without putting all channel closings in the same common permissioned queue (meaning completely centralized). The fact these systems are built around a finite block size means humans can easily attack that bottleneck by flooding it with channel closings. Since it can be flooded, you're required to buffer them and either discard low payers or put them at the back of the line just like regular bitcoin mempool.
From that point, you either have to design as a hub and spoke model just like what Mike Hearn claimed, where the Lightning node is a bitcoin bank and everyone who uses it is their peon slaves to extract usury upon, or every lightning node broadcasts a shared queue with each other. But due to the fact that people can try to flood the queue as mentioned earlier, each lightning node will have their own criteria for what is or isn't spam, or who is and isn't a terrorist that they will broadcast to other nodes (meaningly INSANELY PERMISSIONED, cartel coordinated, and usury based). The nodes might also be incentivized NOT to broadcast and force a hub and spoke model for their own gain.
If a Lightning node constantly broadcasts flood bullshit to everyone, they will likely be blacklisted by other Lightning nodes (lightning banks, whatever you want to call them), so the entire system is based around things like trusted and untrusted members, subjective anti-spam filters, etc. In other words, for Lightning to work at all, it would probably be the most permissioned centralized piece of garbage ever to exist. No real difference from having an account at Bank of America, and ironcially, the govt will likely legislate who is and isn't allowed to run these Lightning nodes, meaning Bank of America or Goldman Sachs will run them.
At least this is my understanding of the problems one has to overcome to create such system. The fact bitcoin is not decentralized and it's impossible to create a decentralized digital currency in the first place, also means anyone claiming Lightning is going to be "decentralized" is a complete idiot when it's built on top of bitcoin.
Do you actually know what LN is? I'll tell you what it is. LN is nothing more than establishing bitcoin banks on top of the blockchain. All of the exact same regulation traditional banks have will be applied to them and bitcoin will be virtually identical to your current banking system. The only reason it hasn't happened yet is because it's too difficult for them to play whack-a-mole with regulating miners, but the LN "nodes" aka banks are less ambiguous in nature and will be regulated to infinity just like any normal financial services provider or bank.
The costs, compliance, and amount of lawyers needed will be so high only entities like JP Morgan and Goldman Sachs will run them. This is how crony capitalism works. You introduce regulation with compliance requirements and fees so high that only your existing monopoly can participate while all small competitors are eliminated.
Nevermind the fact LN doesn't function in a decentralized manner in the first place. There is also ZERO incentive for LN nodes aka banks to broadcast transactions to external peers. There is actually incentive for these bitcoin banks to FORCE a hub and spoke model or cartel collective in order to hold their users hostage for usury fees (just like regular banks do). There's also nothing that stops them from changing usage of bitcoin as settlement to ripple, US dollars, or anything else.
