As stated Freicoin implements everything Tesala suggests and we believe it will have the effects he describes, plus additional benefits.

Chief amongst those additional benefits is a low, ideally zero rate of basic interest (basic interest is what you pay for a no-risk loan).  The deflationary nature of BTC means a borrower would be assuming a massive risk in taking a BTC denominated loan.  Deflation brings huge UNEARNED windfalls to lenders and is thus very bad because it suppresses lending and investment.  In a Freicoin economy in which money is losing face value over time lending at zero interest is still a gain for the lender as they can defray some or all of their demurrage this way, the borrower effectively pays the demurrage while holding the money and has to come up with more then they borrowed to pay back the loan (to the borrower it's just the same as any loan in this regard).

Now let me address another point that opponents of demurrage often raise.  The desire to store value without loss, they point to this desire as a justification for a money system that will allow savings without cost (like Gold or BTC).  But they rarely ask how this is done in a money system when the 'value' of money is all out their in the real world in the goods and services that the money is competing for.  When they do it usually consists of "well I did not spend my income, thus I consumed less now, entitling me to consume more later".  A bit deeper but your now fully dependent on the marketplace to due two things, first it needs to accommodate your non-consumption (you basically reduced money supply) and then it needs to accommodate your increased consumption later in which you reintroduce your money (expanding money supply).  So the marketplace is doing you a service when you use money in this way, and what are you paying the marketplace for this service?

Perhaps you think this service costs the marketplace nothing, and thus it is fair to pay nothing for it?  But ask, could the same thing be done if you were to "go Galt" and just live on your own without anyone else?  For this exercise we will ignore the obvious division-of-labor that makes you less productive alone and just ask can you 'save' and suffer no losses by just stockpiling things like food, clothing, tools etc.  Obviously these things decay away.  BUT BUT these lumps of rare metal wont rust EVARR!!! Well great job try to survive on those, on you can't, and it looks like they are an insignificant fraction of your total wealth anyways as your sustenance is always dependent on a basket of diverse things, some decay rapidly, some slowly, and just a few not at all.  So total up that whole basket and figure out how much it decays in value per year, you alone alone can't save value any more efficiently then that.

As soon as you realize that goods in the real world are constantly decaying and being made anew by hard working people we can see that 'saving' with money is just an illusion, sure you might have consumed less today to actually have the pile of money but someone else needs to make the goods and services that you intent to purchase again someday.  In essence your asking everyone else to put the goods you didn't consume years ago on a shelf, maintain them against decay at their expense and then provide them too you at a later date.  Now obviously goods are not literally put on a shelf and everyone here knows that, but people seem to have it in their minds that money is like some kind of 'Time-Tunnel' that moves unconsumed goods and 'deferred-consumption' from the past into the present or future.  And in a sense it dose, but the marketplace undergoes disruption to achieve this, first it has unconsumed good to deal with which will result in economic contraction, then it has a shortage as money comes back into circulation and bids up the price of goods.   All this creates losses on the part of other people in the economy and they pay for the time-tunnel magic of the savers deferred consumption.  Demurrage corrects this cost by putting it on the saver ware it belongs rather then on the market overall, this is why it's fair and normal money is not.