Crypto founders have a unique challenge in front of them. In addition to building a product that people want, they also need to consider how that product can successfully run in a decentralized manner — that is, as a protocol owned and operated by a community of users. This is a difficult challenge because much of what it takes to build a successful product at the outset — product leadership, rapid iteration, a managed go-to-market — complicates the path to community ownership and regulatory compliance, which guarantee long-term health. Here’s a three-step process that may serve as a guide for how to do it, by way of progressive decentralization, a process in which founding teams relinquish control by degrees, over time.

Jesse's article is excellent. I think you may be correct on etymology, though it's possible it was parallel invention. Earliest public timestamp I can find is below. But we used as far back as 2017 internally. It is a play on progressive enhancement.