I've noticed that there are several people in VRChat that are very elitist with the account ranking system. I've heard of several instances where people will block lower level accounts on sight just for being a lower level. One big issue with this is that as far as I'm aware, blocking someone hurts that blocked person's status, which is an issue when people block based on level alone. In fact, I heard this was a huge issue in the beta of this feature when the gold status was a thing and wasn't for friends, that people that were lower level were mass reporting/blocking higher levels and higher levels were doing the same to the lower levels.
At the same time, I understand the use of this system. In public worlds with lots of people, having lower ranks with their features hidden can improve performance, but that's about it. I understand why this was put in place, to prevent people from crashing you and to prevent being harassed by throw-away accounts. However, the main issue with this is there are still hacked clients out there that can get around this and I've even seen people with the trusted rank harassing others and crashing people. I've even been crashed by them. Some hacked clients can even get around features such as blocking, kicking, possibly reporting, and can even do things like make portals spawn on top of people. They even manage to use things that can crash people instantly even with them blocked.
I've had to deal with stuff like this personally and I feel as though the ranking system needs an overhaul because it's not very effective unless you're using it for performance. One of my friends even likened it to China's social ranking system, which is honestly not very flattering for a game.
I personally have no idea how I'd go about fixing something like this beyond having the ability to hide avatars/features that go over a certain limit set by individual players kind of like how you have the dynamic bones set up in the performance menu. A greater use of this performance menu might actually solve a lot of issues if your main goal of the ranking system is performance. As for elitists and hackers, there's no way around this. They will always exist. The best you can do is improve security.
To be honest I'm reminded of Second Life back when this stuff was a huge issue for them. They never introduced a rank system, which ended up being a good thing, but they did eventually introduce ways to hide avatars based on a user's preferences as well as report systems and they even have a much more in depth graphics settings system. I understand we're working with Unity, but some of this stuff is still possible. Potentially you could introduce play time on profiles. Second Life already has that and shows how old an account is, though that is also flawed I will admit in that it doesn't show how much a person has played on that account.
I know there's no easy solution, but all this is definitely stuff to consider.