For speculators, almost the same that bitcoin: it's $0 now, but it will be $97 later.
If I understand it correctly, freicoin will lose value while you hold it, and will provide incentive to give it to someone else (like merchants). Why would speculators, the first people to exchange real money into this experimental money, expect their freicoin to be worth more in the future, if this money is by design supposed to lose value?
The currency is designed to lose nominal value, but if the freicoin economy grows, you can't avoid deflation.
And isn't them holding currency that appreciates in value the root of your "money interest from holding money" problem?
Not exactly. The interest comes from the money not losing value and being necessary for trade. The money holder can exploit that need, but you don't need deflation for that. Our current monetary system has not deflation and has interest (although the system is also designed to cheat small lenders).
Freicoin (like bitcoin) would eventually reach a user base equilibrium and have an increasing value based only based on growth.
But if the deflation rate is lower than the demurrage rate you still have an incentive to spend or lend your money.
In fact I think that bitcoin could have more deflation than freicoin since the deflation comes sometimes from shrinking credit, which you need periodically to mitigate the exponential growth of debt debt, an effect of interest. Yes, I believe that business cycles are based on interest. Central banks and fractional reserve only makes them worse, but they are not the root cause.