That's pretty cool.

Downsides seem to be that there is no denial of service protection across rounds, the same utxo can disrupt many rounds. A centralized coordinator banns a utxo for numerous rounds.

Also blockspace efficiency is not great, a single equal denomination means users need to do a lot of rounds and create / spend many coins. I don't know how this can be fixed though, maybe some ring signature credential that commits to a homomorphic value commitment, something like Wabisabi kvac but with federeted authorship.