Yeah, I hear you. I am hoping they are just crutches to bootstrap bitcoin adoption. If bitcoins become popular, perhaps we can lose the crutches. Or perhaps we'll have tons of competing escrow businesses.

What is it with humans' tendency to centralise anyways? Here is democracy... now here's an all-powerful president and congressional oligarchy. Here is the industrial revolution to facilitate transportation of goods all around the countryside... now here are the giant megalopolises in which most of us now live. Here is the internet... now here's Gmail, the single location to email, and Facebook, the single location to put all of your personal data. Here are DVCSes... now here is github, a place to centralise all of our DVCS work.

Maybe there's just something fundamentally ingrained in human psychology that makes us converge like this.

> What is it with humans' tendency to centralise anyways?

I think it's less about human psychology and more about managing efficiency.

A well-run centralized system will always be more efficient than a well-run decentralized system, by virtue of having less overhead. Whether it's overhead from arranging logistics to one large city, instead of a hundred small cities, or overhead from interacting with one large federal government, instead of 50 small state governments.

> A well-run centralized system will always be more efficient than a well-run decentralized system, by virtue of having less overhead.

That's a circular definition, unless you have some objective way to measure how "well-run" a system is other than just measuring its efficiency.

> Maybe there's just something fundamentally ingrained in human psychology that makes us converge like this.

Or perhaps there are meetings in boardrooms where the upper echelon of a given sector of the economy work hand in hand with thinktanks, highly paid psychologist consultants, PR firms, journalists, and media executives(at the ownership level) to design and execute strategies that encourage whole populations to act against their best interests by entering into these sorts of centralized arrangements.

Why does everyone always jump to "human nature" as the explanation ? I'll tell you why it's because they have no visibility into the 10+ billion dollar/year PR industry that is operating in our midst. Human nature does factor into this though.. it's human nature to assume that you're not personally vulnerable to suggestion and manipulation, so people tend to write it off even though statistically speaking the odds are that they can be influenced, and are being influenced.

Businesses want to reduce risk, reduce overhead and maximize profits. Lenders want to reduce risk and maximize return. Customers want their assets protected and want fraudulent charges to be reversible. Other businesses in other countries want to know what to expect when dealing with businesses in yours. Having a known regulatory framework and a system of laws regarding commerce, trade and consumer protection facilitates the level of efficiency and complexity necessary to have the economies of scale we currently do.

Almost everything else you list is a matter of scale. As far as industrialization goes, all that industry requires an infrastructure, which itself requires an infrastructure, adjacency to materials, shipping, energy and a labor pool which won't be paid well enough to simply drive in to work from wherever. Even mere agriculture can be considered a centralization of hunting and gathering - as you needed one place to keep all the farms and the slaves and the temples and preferably all of that close to a river. It's not irrational. In fact, I believe the more difficult argument is in favor of decentralization - Bitcoin is attractive to speculators, scammers and hipsters but why would it be attractive to businesses or the average consumer without a proxy for the existing legal apparatus?

Gmail is not "the single location to email", it's simply the leader, there are still many email services out there, you can host your own email server if you want, it's (probably) not illegal. Is Google not an example of a free market working as intended? Surely, just because a free market suggests there should be competition, it doesn't imply there must be. You don't have to use Facebook if you don't want to. Sure, everyone you know is probably on facebook but you're free to try to create your own social media site and compete, or simply not use it. The market decided on facebook, if you don't like it, well, too bad I guess. Github exists because someone decided an online version of git would be successful, and they were right, it is. The market chooses winners, either honestly or dishonestly, legally or extralegally, and eventually the winners dominate, which Facebook and Google do.

Centralization is prone to corruption... 2008 financial crisis ilustrated it very well worldwide...

Decentralization, while having a bigger overhead, also benefits from a bigger pool of contributors...

Example 1 - mathematics: if the europe-mathematics did not cooperate with other world-mathematics, they would limit their knowledge to only european findings, which would leave them reduced compared to the worldwide mathematics investigation

Example 2 - wikipedia: more updated and complete than many classic-editor-encyclopedias that were sold before wikipedia was made.

I think the problem here is that you are confounding different types of problems.

Knowledge tends to benifit greatly from decentralization; building railroads, not so much.

> Maybe there's just something fundamentally ingrained in human psychology that makes us converge like this.

Convenience/laziness, lack of concern about privacy, and social signalling help to explain the internet related centralisation examples you noted.

"Free", convenient and easy-to-use (and your privacy goes out the window) will win over inconvenient, marketed improperly, and slightly more difficult to use every time with the mass market.

Centralization tends to be more efficient and convenient. It also is more profitable for whoever does the centralization.

I've found that the-whole-point-of-isms are almost always wrong.

It's not the whole point of Bitcoin to be a decentralised payment system. It's part of the point, sure, but there are many other points, such as being an asset with a predictable inflation rate, and allowing the storage of value protected by cryptography.

A few centralised actors offering service to those who choose to use it does not negate those points of Bitcoin.

Now I can travel to another country and book a hotel through this service (if they allow this in their terms of contract) with my Bitcoins without involving any banks or credit companies on my side and nobody is in-between (except the Internet). Seems pretty de-central to me. If they choose to handle the Bitcoin clearance through an intermediary is none of my concern, so I don't see any fundamental principle violated here.

Almost all of these merchants are receiving USD and they do need some party to handle the exchange risk. Coinbase/Bitpay do this and their fees are substantially lower than credit card companies.

This. I integrated coinbase into my sites and that is why. However, I do see the important part here is that a customer doesn't need a coinbase account, they can send BTC natively which is a big distinction from using a CC.

The real service Coinbase is providing is the conversion of bitcoins into government currency. I can't think of an immediate way to decentralize that, because moving government currency between people requires centralization (short of mailing physical cash, which obviously has its own issues).

It's fairly trivial to simply accept bitcoins in a decentralized fashion. That's just what normal Bitcoin transactions are.

There are multiple companies/exchanges that can convert BTC to USD, yet prominent merchants only use Coinbase. That's the centralization.

So what solution are you suggesting to this?

The real problem is trustworthy BTC -> USD. Expedia can't pay their employees with BTC, and the executives don't want their bonuses in BTC either.

Coinbase is a solution to this problem. And it's better to have one trustworthy, rather than a bunch of mtgoxes. Yes, it makes it 'centralized' but it's the best solution in this case. Without it, BTC is just internet points.