It increases the skill needed because it makes it all about human interaction and your fighting relationship with your opponent, rather than just you and how you can train to punch hard and toughen yourself. It is now a game between two people, where the stakes are high. Rather than being able to be careless and just charge in there and take a bunch of hits, but hit harder yourself (which is what happens in a lot of ameteur fights), you need to be able to avoid being hit, as just one punch to the face is likely to take you out. It emphasizes defensive skill, footwork, feinting, predicting your opponents movements, counter-striking, etc, and a lot less beat them till their eyes pop out.
Fights are actually a lot less exciting to watch with no gloves. Very few punches are thrown, and when they start flying, the fight is over almost instantly. Fighting with gloves on makes fights a lot more enjoyable, because there is lots of back-and-forth trading of blows, and fights last much longer.
When someone knows that the first punch that lands on their chin could take them out, they will be a lot more protective, and learn to master those split seconds of making contact, which really decide most fights. (ones between skilled fighters that end decisively...not stupid, drunk brawlers)
You should try going down to 4 oz gloves and see how much harder boxing is, and how much more skill is required. Then try it bare-knuckled if you got someone willing to take the risk, and you will see that it takes a whole different skill set.
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