The network will eventually be run by “oligarchs”. Once software is optimized as far as it can be, it will come down to hardware, bandwidth, and, in the long-term, electricity generation. Most people won’t be able to keep up.
It will if proof-of-work comes down to something as specialized as solving a single, well-defined, simple, and predictable hash function such as SHA-2.
We need to make proof-of-work more choatic and complex if we want to avoid this.
SHA-2 was actually designed to be computationally EASY because it’s original purpose was digital signing, not proof-of-work.
Otherwise, it will end just like you say.
Think of this vision of the year 2020: 2/3 of the world’s Ghash/s is controlled by just three companies. They manufacture their own specialilsed HPUs (hash processing units) and feed them with custom-built power plants. The Chinese goverment then persuades the three companies to double spend 10% of all transactions into the Chinese government’s bitcoin address, in return the companies get an exclusive deal on the rare earths they badly need for the HPU manufacture. Some people leave Bitcoin for alternative currencies without the 10% “tax”, but most tolerate it because by then Bitcoin is accepted almost universally.