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Yes, if they wanted to they could. They would not be paid the "moderator" rewards if they split their SP like this though, since these would only be paid out to accounts with > 100 SP. The idea is that the moderators would be incentivized to be moderators.

The line would be drawn at the blockchain level. It would require a HF. 100 MV is an arbitrary number. It could be made higher or lower depending on what people feel is the right threshold. That is one of the parts that would need to be sorted out if this were to be implemented.

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