I'm afraid this system strikes me as being a bit overly complex -- it would seem to me that there should be something simpler and less fussy that gets you most of what you want.
It's possibly a strained analogy, but consider that the winning strategy in prisoner dilemma tournaments is just "tit-for-tat". Everyone tends to assume that more complicated strategies with more use of history will work better, but that's just not the case.
On the other hand, I don't particularly care myself -- I think in practice no one in their right mind is going to keep track on the current XP rules; and after posting this I'm just going to go back to regarding it as a mystery I'd rather not know about.
(If I were designing the system, I might go for one where only up votes were allowed, and there was no reward for voting -- what kind of democracy bribes people to vote?)
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