What makes this worse is that they want to transition ETH to a "Proof of Stake" system. This will encourage this kind of behavior, since that system is based upon who has the biggest pile of wealth.

It reminds me of the current fiat system in that regard. Its one of the reasons that ETH is on my no-go list for long term investment. Scalping and short term trades, sure. But not something I'd sit on for more than a month or so.