Either way, just because something could be shut down doesn't mean they will be.
Right. But it's a "sword of damocles" that doesn't exist in Bitcoin and other decentralized currencies. It's a crucial competitive advantage - together with the things I mentioned in the second post.
If it were, we could make a compelling argument that Bitcoin is absolutely better than Paypal just because the latter could be shut down, but it doesn't work that way. There are several aspects that make a project good, and decentralization is just one of those. We haven't seen a good centralized coin that can compete with Bitcoin yet, and we never may, but I'm not ruling it out.
You are obviously right that a decentralized payment system isn't better than a centralized one
per se. Paypal and similar services, for example, are much more energy efficient than Bitcoin and can easily peg their token to a widely-recognized "unit of account" like the USD.
But I have doubts that a "centralized cryptocurrency" has a real use case. Cryptocurrencies are technically designed to be trustless (or at least low-trust, like in PoS currencies). This comes with tradeoffs in terms of efficiency.
At the end, a client-server model (like Paypal does it) is probably the better model for centralized currency/payment system projects. The only advantage a "centralized cryptocurrency" has is that users take a part of the maintainance costs because they have to run an app that does much more "work" than a typical Paypal/e-payment web-app, but that is an advantage for the maintainers only, not for the users.
A
(semi-)centralized open-source cryptocurrency (e.g. Bitshares/Steem) can have some advantages with respect to Paypal, because in the case of insolvency or retirement of the "maintainer" its value will not necessarily go to zero if an alternative maintainer is found ("community takeovers"). These takeovers are not likely in the case of closed-source or patented cryptocurrencies, so they do not have that advantage.
I conclude that closed-source/patented cryptocurrencies have almost no advantages with respect to centralized client-server payment systems like Paypal, and they are also less efficient and thus more costly.