It’s defintiely 2. But ads are priced on value to the advertiser. If someone reduced fraud to 0% they would just charge 20% more, and that money goes from fraud

It’s defintiely 2. But ads are priced on value to the advertiser. If someone reduced fraud to 0% they would just charge 20% more, and that money goes from fraudsters to advertisers, not more ads. This exists already, networks that filter out fraud better can charge higher rates.