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RE: If you want to understand how the flag wars effect your rewards, look at these diagrams. You may be surprised at their effect!
This doesn't work when you flag whales though.
Only for evenly staked accounts. So that last diagram is wrong. Especially when you factor in the wide gap between whale and plankton. 10 plankton of 20sp each flagging a whale of 400k SP won't remove 3 cents from his earning.
It still works, just on a smaller scale.