A thread a little bit better than average in Altcoin Discussion on that topic, but with a wrong conclusion imo.
Being centralized is making such coins very flawed and prone to hacks.
I agree with "flawed", but not with "prone to hacks". If a centralized project opens the source code of their reference implementation, then the danger to be "hacked" (whatever that means) is similar to a decentralized coin. Perhaps not similar to Bitcoin because popularity is very important for the "million eyes" open source model.
Also, founders can be dishonest much more easily in a centralized project.
Yep, but that is quite a trivial affirmation. About PoS I agree though.
SEC needs to crush Ripple
I don't care if they "crush" Ripple. All they need to do is to require it to be transparent - like any kind of security. Then people would rapidly recognize no blockchain (or whatever the Ripple folks calls it) is needed for Ripple's business model. And they would break on their own.
Now: my take on
the big issue with centralized coins:
They cannot guarantee that they offer censorship resistance, which is the most relevant characteristic of a cryptocurrency like Bitcoin.
The reason is that they have a single point of failure. A premine will always align the incentives in a way that the founder team will be always the highest authority. And if the authority, for any reason, decides not to support censorship resistance, then there's not much you can do as an user/community member of this coin. They could e.g. proceed to censor transactions because they were hacked (case ETH/ETC), or because a goverment orders them do do so.
You may think you have two options if this occurs:
1) You could try to hardfork - but then the central authority and their supporters would dump your forkcoin into oblivion, like it occurred with ETC.
2) You could try to "takeover" with an own software version, trying to get a majority - but this software version will never become dominant, if the authority doesn't support it. Because the authority most likely controls the PoS-style validation, and you're unlikely to succeed getting a supermajority of the remaining stakers.
Even if you partly succeed: Who finances development? Even in cases like ETC where the forkcoin could retain some developers, the coin is only worth a small fraction of Ethereum's. Because costs are high, and the authority developers will have always a part of their premine to finance better improvements than your small forkcoin.
Then there's the big question: why should anybody work for a coin others (the authority/founders) have benefitted disproportionally from?
Thus, centralized coins are not really cryptocurrencies. They only use "blockchain" to generate hype, and in theory their "coins" could work much cheaper if using a PayPal-style model.
