This new proposed update is set to increase mining rewards by 5x.
This is a bit misleading, and I thank @pfunk for explaining this to me. Witness rewards are proposed to be so drastically cut overall that even with the 5x bonus, miners (and runner up witnesses) will be making less than now.
The overall cuts are extreme, harmful, and unnecessary, but if they are made then there is actually an argument that the 5x bonus is not large enough. For example runner up witnesses now struggling to cover server costs will find themselves overnight even more underwater or will quit.
Very true - it is going to decrease overall (like everything else), but proportionally it will increase. It's all the way you spin it.
I suppose a better way of explaining it is that it will be 5x the amount an elected witness will receive.
Either way - I'm still not for it :)
Why does this matter?
I don't see the logic in going from 1x the amount of an elected witness to 5x.
I'm baffled as to why it's being increased as opposed to remaining the same.
I suppose it "matters" because it's an illogical choice in my opinion.
I would guess it is an attempt to reduce the inadvertent impact of the huge reduction on overall witness rewards (clearly directly primarily at top 19) on miners and runners up (i.e. keep their rewards closer to the same as before). It misses the mark a bit -- the miner and runner up rewards still ends up with a net reduction -- but not nearly as much as without the multiplier.
How else would you propose to reduce only top 19 witness rewards (presuming that is a good idea)?