It's not really novel, Hayek wrote a book arguing that competitive private currencies would provide economic stability without central control.

Whether new money is issued by a central bank or other agents, it seems to me the effect is pretty much the same.

I've done some reading. This idea is about refining the concept of money, to give control to the agents and remove the untrustworthy and incompetent regulatory control. Interesting indeed. However the mechanics of maintaining stability as described by Hayek are largely the same, it's only the controlling party who has changed.

Edit: And back to the point - Bitcoin has no controlling party, it cannot be manipulated in this way at all. It cannot respond to business cycles.