Right now text is pretty much the only thing that can be stored on chain. It will be nice when video is also able to be stored on line, but I think that is a bit down the road.

I really do not expect applications on layer 2 to be decentralized, if there is a problem with an app I want to know who to go to to resolve the problem.

Hive Engine is a second layer system, it seems to work, Spliterlands game and several others are second layer application. PeakD is a second layer application, and they all seem to work pretty good.

I am not really a crypto person, nor a programmer, so I may not understand the nuances of SMT's being on the first layer or the second layer, I am just a user of the hive block chain. I see Hive as the decentralize ruled by no one in particular place, where people can come and build what they want tax free. That makes second layer application primarily centralized, I have no problem with that. If the applications development is not functional due to poor developing skills people will just go to another place.

It was only about 30 years ago that the internet came into being, pretty much as a decentralized entity. Standards were set, language was set, and methods were set, and all of them were part of the beginning of "open source" free to all who wanted to create.