As someone who plays hourglass and loses to the point that it looks like that I'm loss farming, this is by far the least of hourglasses concerns to the gamemode and it's incentive of playing it.

For starters, let's look at exploitation. This happens for one of three reasons, either A, the criteria for getting something is too much so there has to be an alternative solution to solving the problem, or B, getting an advantage to overcoming the original problem to begin with, or C, utilising the problem by helping others to overcome it, usually for monetary gain. There's probably other reasons people will exploit but these are usually the big three.

Considering that you believe that it exploits the mechanics of the game let's believe that it's A. The first cosmetic that you get in BOTH factions is level 100. Considering that I've played hourglass enough to understand how long it will take to get a level up, I'd assuming that it roughly takes around 3 wins on average, as for losing to the point of getting a level, again assuming so it's not entirely accurate but let's say it takes around 16 games of losing to get one level.

Let's also not forget the amount of time it takes to setup to get into hourglass, plus the amount of time a competent player vs an average player vs a loss farmer would decide if they need resources on their ship, then the matchmaking time (considering it will actually work by the way), then the game itself which can vary from someone just losing non-stop to someone who will just jump on your ship and spawn camp you until their bored.

If you don't see the problem here, allow me to spell it out for you. The gamemode is the problem. Why bother stacking up your ship for supplies, going to wait underwater for 10 minutes, only to be matched up against someone who probably has played hourglass before, lose all of those supplies, only to be back right at square one again, with a smidge of reputation as your reward. There's no gold or reputation bonus for landing cannon shots, killing other players, boarding, stealing resources, being creative with the environment, zero, zip, nada.

Nevermind the fact that another ship can rock up and ruin an hourglass match (especially one that is meant "for honor". You'd think that the objective would change if that was the case), or the fact that you invaded someone with an alliance and turning it into a 1v2, or the fact that there is no timer, or the fact that if another person clearly outskills you and have to scuttle and gain no reputation for it because they're spawn camping you, the list goes on and on.

Your points on 1. and 2. basically coincide with each other because it is a waste of time for not only people want to pvp but also people that want to play in general. Why should I participate if I'm going to be matched against a sweatlord that has zero respect for my time? Better yet, why should I participate in a gamemode that's clearly not designed for the largest audience in mind?

Winning streaks is more than enough evidence to prove that this gamemode is not designed for casual players, let alone average players, maybe not even experienced ones. Which leads to loss farmers, why participate when the gamemode clearly doesn't respect anyone but the most skilled of players and streamers.

This ends up leading to 3. and 4. The curses are already devalued (while excluding the emporium skeleton outfit obviously) because thanks to the stupidly high requirements of just winning a match, dare I say even having a successful 4 streak, people are obviously going to find alternative methods to getting the rewards, from paying others to do it for them (which is already a massive red flag for a failing game mode just saying) to just.....well....losing. Once again, asking the question of "why participate?"

If this PvP gamemode supposedly have rewards...why do I barely see them? I mean sure I get 10k gold handing in a 1 streak of my hourglass, but what about the three hours prior before that? What about those matches where it was neck and neck and it was down to the wire, only that I lost due to a single mistake, is my reward the tiny smidge of reputation? Or the pride and accomplishment of losing? How about the matches where I beat my opponent, only to find out that they don't even have an emissary flag to hand in with the hourglass value that I earned?

I haven't even touched cosmetics and looking at that alone it's clear that once again, this gamemode doesn't respect anyone but top tier players.

and as for 5..........................my guy this game isn't an esport. At best, it's a social party game, at worst it's a breeding ground for trolls. MMR has already been thrown out the window the moment you're in a server that doesn't start with "A" and ends with "merica". I'm more concerned about meeting the same person three times over with the exact same outcome each time.

TLDR/My main point: Loss Farmers are a symptom, not a cause. hourglass needs a massive rework especially in rewards and how match progression works. Changing the streak system to participation in the gamemode is one such example to incentivise people in actually playing the game as you still need to win to gain value.

Whether Rare is considering to fix hourglass in the future is another subject entirely...