if I have two wallets and keep transferring money back and forth it will never rot by your formula.

that kind of money must self destruct without exceptions. it should keep its value until it destroys itself after a period of time. just like a tomato that you forget to eat becomes rotten and has to be thrown away.

with BTC, the network can claim the money back after it has expired. this way you don't need to limit the BTC supply by 21 million. if each 50 BTC generated had 1 year or so to circulate from the point of minting, then everyone will be forced to keep the money moving. this would also solve the problem of forgotten wallets and coins lost in hardware and software failures.