Great post.  I've always felt the same way, there is no such thing as a trustless or permissionless chain.  No anonymity or decentralization either.  Just varying degrees which can and will be easily altered with time/adoption.

But you can't blame blockstream, the anarchists and libertarians, who probably make up 90% of crypto were sold on this pipe dream and will have a meltdown if they're woken up abruptly.  

That said, I don't agree with your latter points about sidechains, although I'm not a techie.  Counterfeiting won't be possible without being easily and instantly caught and tracked infinitely easier than with fiat.  So that is a moot point.  And they will not use offchain - at least not for the 7.4 billion monkeys, that would defeat the whole purpose of the block and chain protocol.  

As for fractional reserve banking:  DUH!!!  

How many lies are people gonna actually eat?  All of these things were fairly common sense unless one was gullible or delusional.  You didn't even need to understand the tech, just the way of the world and human nature.  Even now there have been multiple large scale cases of fractional reserve banking using Bitcoin.  Call it the nature of the beast, or the natural regression of things.  It's simply gonna happen and no muppet is gonna stop it.

Blockstream has the best crypto coders in the world, and for all you know they're secretly working with Satoshi, so whatever they come up with will go mainstream and it will be completely secure and counterfeit proof.  

Enjoy the sidechain show; I know I will.  

Blockstream has been the only company funding the development of the Lightning Network so far.