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The reason why you lose ELO when playing against somebody of much higher ELO is because the system is designed so that if you played against that person 100 times your ELO rankings would be stable. The odds are against you, but you would still win a couple times, get a lot of ELO and they would lose a lot of ELO. But they would win most of the time to get a little ELO while you lose a little each time. So in the long run the two of you would not gain or lose any ranking at all so long as you both started at your accurate ELOs. If you didn't start at accurate ELOs then by the end of 100 games you would have them.
Making one person not lose ELO breaks this entire dynamic. It would cause ELOflation and with how things work now eventually everyone would hit Masters rank because aside from top 100 the ranks are tied to your raw ELO. You wouldn't "lose" your ELO but you would still fall behind everybody else.
The end point is that losing rank against higher level players is good. It may feel bad in the moment but it helps the system match you more with players of your skill and less against higher skilled players.
Is this information the developers have shared and if so would you have a source I can visit to read more on it? If they're truly just using the elo system from chess that would be disappointing as this game is not as static as chess. By that I mean there are variables within that game that influence a match beyond just skill, those being character selection and stage selection.