Looking at how player ratings have evolved since this change, it seems that the ratings of the top algorithms have become quite inflated since before the change. For example, my algo, which hasn’t really changed from season to season, has the following ratings:
season | algo | elo
6 | spinach_54 | 2788
5 | spinach_53 | 2273
4 | spinach_48 | 2245
I would guess that this +500 elo jump is probably due to the wider matchmaking as well as the cap on rating loss from losing to an algorithm >400 points away. Maybe it is worth testing out whether removing the rating loss cap will reduce this rating inflation so that ratings won’t keep inflating as time goes on.