I'm curious: the stake-modifier has to do with the hashing of the stake blocks? Anyone care to elaborate?
Nevermind, I answered my own question by finding this nice comment in kernel.cpp:
// Stake Modifier (hash modifier of proof-of-stake):
// The purpose of stake modifier is to prevent a txout (coin) owner from
// computing future proof-of-stake generated by this txout at the time
// of transaction confirmation. To meet kernel protocol, the txout
// must hash with a future stake modifier to generate the proof.
// Stake modifier consists of bits each of which is contributed from a
// selected block of a given block group in the past.
// The selection of a block is based on a hash of the block's proof-hash and
// the previous stake modifier.
// Stake modifier is recomputed at a fixed time interval instead of every
// block. This is to make it difficult for an attacker to gain control of
// additional bits in the stake modifier, even after generating a chain of
// blocks.
