I believe this solution does create an incentive for stake consolidation of nodes, which in turns diminishes infrastructure costs. However there’s a few underlying considerations that I want to highlight as we keep seeking for creative solutions such as this one:
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The implementation of a ceiling should never carry state bloat (keeping track of average stake, keeping track of stake age, keeping track of more data on the state), which this solution doesn’t so I believe this is in the right track.
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One incentive this creates is that nodes will want to edit their stake every session, which means there will be (by current node count) 48k transactions potentially fighting for block space to edit stake, alongside with claims and proofs, creating block space bloat that we don’t want to see. A viable option to deal with that is that this change comes accompanied by a “reward percentage” field in the Node state data, which would indicate a split between how much of the relay reward goes to the Node Account balance and how much of the relay reward goes directly into the Node stake amount, creating an “auto-compound” feature, which should be enough to counter-balance the before mentioned incentive.
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I would also recommend exploring upping the transaction fees for claim and proofs, as well as stake transactions, since now more nodes will be fighting for that block space.
Whenever we explore a solution, we must always take into consideration the side-effects, and even if more mechanisms can be created to combat these side effects, the increase in complexity must also be a factor. With that said, I believe this solution is worth exploring.