We still use a web of trust, but we've refined how trust is established between users. In the previous version, trust was established whenever a user upvoted another user's content. This was convenient and it allowed us to reuse a user's trust to determine their share of daily rewards. No more.
In this release, trust is gained when two users upvote the same piece of content and diminished when one user upvotes something the other user doesn't. A statistical model is used, specifically, a binomial proportion interval, to determine this trust level even when the sample size of upvotes is small.
Why the change? Mostly because if I trust the content you share (by upvoting it), it doesn't mean I trust your upvotes. This release means you only gain upvote trust if and only if you upvote well according to other users.
Everyone's trust has been recomputed and this is live right now. Notably, many more users are now trusted given that they lurk and upvote more than they provide content.
Given the trust algo change, we needed to change daily rewards too - your upvote trust doesn't entirely account for the value you bring to SN. Also, the way rewards were dispersed was not obviously related to the value you provided recently - if you had shared good content, even in some distant past, you were regularly rewarded. In interviews, most users didn't know why they were getting rewarded.
You now receive rewards strictly depending on the last 36 hours of value you provided. Very good and active users are likely to see 5-20x the daily rewards.
How rewards are dispersed now:
In a prior release, in response to users saying they were overwhelmed with rewards notifications, we made it so we only showed your rewards once and then disappeared them from your notifications. Reward notifications are back to always being viewable while solving this problem for those users (we identify "islands" of reward notifications and combine them into one notification).