I think large hubs appear because people want to connect to nodes that are always online and already have many connections, since it can result in shorter routes and thus cheaper fees. So, if we think about nodes/hubs as some sort of payment processors, there are still a lot of differences between them and traditional payment processors - they can't freeze or steal your coins easily, because Lightning protocol has strong anti-cheating mechanisms. You don't have to use hubs if you don't want to, you can always choose some alternative routing or just connect with someone directly - this is not possible with fiat, since you can't just start your own small bank.
firstly
in channel. there is NO community audit/ checks of payments. is just counter-party A vs counter-party B
this leads to a few issues. counterparty-B can (because its open source) edit his own node so that it is the handshakee.. meaning cpA has to offer their hand first(sign first)
if cpB received cpAs signature of lets say tx3, but then cpB was to refuse to sign tx 3. and then cpB went on to DDoS cpA..
cpB can blackmail cpA because
if cpA broadcast tx2(the only fully signed tx cpA has) cpB could the sign tx3 broadcast tx3 and csv revoke funds away from cpA
..
secondly
you say its not like traditional banks.. pfft
there are 1600 nodes right now. and there are some hubs with over 100 channels.. (upto 10% co-signing control of nodes funds)
imagine a town of 160,000 population and there were 10 bank branches. people open accounts(channels) with a bank branch and then every payment they make the customer needs:
1. bank branch authorisation (counter party sig of the customers<->bank(person/hub) channel)
2. wire transfer authorisation (counterparty sig of the 2 banks(routed hubs) channel)
3. remote branch authorisation (counterparty sig of the remote bank<->recipient(hub/person) channel)
if you take away the buzzwords of channel and replace it with account.
if you take away the buzzwords of mutlisig counterparty smart contract and replace it with requires bank authorisation
if you take away the buzzwords of routing and replace it with wire transfer using bank route/sort codes
if you take away the buzzwords of CSVrevoke and replace it with chargeback
if you take away the buzzwords of CLTV and replace it with 3-5 business day settlement
even the letter C in CLTV and CSV is misleading
if you take away Check(its not meaning validate) and replace it with Cashiers Cheque
you will see exactly what business model LN is copying
....
thirdly
with the costs of initial deposit per channel and offsetting some funds for routing/penalties/onchain closing tx fee.. it is not
cheap to set yourself up as a well established 'bank'.. only the few well funded people will (which has already started to become noticable now)
fourthly
imagine average joe only wanted to use $60 in LN as a risk.. setting up 30 channels means only $2 can be spent. and not all of them will route to starbucks. also. the nodes he connects to that might also have done something similar may have already spent their $2 on th available route to star bucks meaning there is nothing in the routes to hop payments through even if a chain of channels could be found
meaning lots of channels then had to close(onchain) to then re open new channels to re-jig the funds around. which is all done on chain.
LN is not as seemless and open and limitless as people think. devs are still just knocking the kinks out of establishing connectivity(account application forms/handshaking). but yet to even consider/think/run scenarios of costs of running/maintaining and how often/how spread out peoples funds get to require closing/opening channels often
fifthly
thinking that if a node is dodgy. then its a split second decision to move on, is wrong. flawed and naive
its like finding out your bank messed you around. you funds dont instantly become cash in hand. they need to be thrown back onchainCLTV(3-5business day settlement). and then you need to open a new channel and fund the new channel via yet another onchain fee
