Super-big thanks to @jtimon, @galambo, and others who have replied while I was super-busy.
Okay, so how is freicoin better for a successful business than dollars, or bitcoins? What profit do they extract from whom by using it? Does it give them more leverage over their employees so that forcing employees to accept rotting/decaying/evaporating money? It is expected they will get more goods from suppliers per man-hour their laborers put in selling stuff for them or building stuff out of what the suppliers supply?
A demurrage currency results in lower interest rates, which benefits entrepreneurs and operators of stable businesses. Compared with other forms of currency it encourages investment in real capital and increases in productivity. It rewards sustainable enterprises and long-term thinking while punishing exploitative endeavors or shortsighted choices. With a demurrage currency cash flow, not immediate return, is king.
Perhaps you can add this questions to your FAQ:
When would the demurrage penalty be executed?
Based on this answer, will follow a question about how the penalty will avoid exploits, but it depends on when and how demurrage occurs.
[edit] I found in another thread that it is assessed at the time of transaction based on how long it has been held. What is to stop someone from simply holding it indefinitely as a backing for another currency like for instance, phycical bitcoin? If everyone did that, it would be a nightmare knowing how much a physical coin would be worth.
Thanks for the feedback; I will add a FAQ entry.
In the current implementation, all outstanding/unspent outputs decay in value slightly with each added block. For a transaction to be valid, it must include enough inputs to cover the specified outputs
after accounting for decay. (Aside: this makes it possible for a transaction to ‘expire’ if it is not added to a block before its inputs have decayed to less than its outputs. We are investigating methods to transparently mitigate the consequences of this.)
If someone chose to hold the currency forever as a backing for another system, they would be free to do so. However the value of the coins they held would still decrease--even if that decrease never manifests in the block chain--because the loss would have to be realized should the coins ever be spent.
I am guessing that he is not of the/an "Austrian" persuasion?
Gesell doesn't quite fit into either camp; he and his theories stand alone.
You want something like 4% to 5% of the market cap per annum to go to securing the network?!?!?! Sheesh, consider merged mining or something, please! Such a percent seems a ridiculously expensive proposition.
Remember: Freicoin
is not a store of value. Bitcoin or gold (or whatever) can be used for that purpose. Since freicoins are only kept between transactions and in enough volume to have a cash flow buffer, the actual Freicoin market cap will be rather low. It will consist mainly of the liquid wealth that people use in day-to-day transactions, not savings.
So yes, something like 4% to 5% of the market cap per annum will go to securing the network. But the market cap will probably be orders of magnitude less than GDP of the Freicoin economy.
Ok so how many coins per block are to be created and will that number ever change if so how much and on what schedule?
Currently there is a Bitcoin-like fixed subsidy that halves in value every four years, to which is added the total loss due to demurrage and transaction fees (if any). This means the generation curve looks exactly the same as Bitcoin, but the block-reward has an uniquely different profile. It'll grow exponentially until all coins are generated, although with the rate halving every four years with sharp discontinuities. Eventually it will reach an equilibrium at about 40% the original subsidy. value.