"I think that increasing the block size will increase centralization and thus violate Satoshi's intent."
Then why did he specifically suggest that we do so?
"Segwit is just a malleability fix, it is still fully recorded on the blockchain. "
This is not true. SegWit itself claims that it enables "off-chain transactions". Those violate the definition of Bitcoin. SegWit is not compatible with Bitcoin by definition.
He limited the block size to 1mb in 2010 and knew fully well that a hard-fork will be needed to change it.
It enables it. You don't have to use it and can continue doing all your transactions on the blockchain.
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Note Satoshi's quote about it being fine to switch to client-only mode and have the nodes "on a server farm". The real Satoshi made exactly the same argument that Craig Wright made last weekend. Hmmm...
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