Demurrage is a holding fee. The currency expires at the end of every quarter and must be renewed by purchasing a stamp and affixing it to the currency. This pays for the management and printing of the currency, and also motivates holders of the currency to spend it before the expiration date, greatly increasing its velocity or rate of circulation.

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I asked Getliner.com AI: 

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"One study noted that the circulation velocity of local currency is 6–7 times faster than that of legal currency"; how fast would a stamp-scrip based local currency circulate?

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Getliner Responded:

Step 1: Understand what stamp-scrip is

Stamp-scrip is a type of local currency that includes a demurrage feature - essentially a negative interest rate or carrying cost. It typically requires stamps to be purchased and affixed to the currency periodically (usually monthly) to maintain its value. This creates an incentive for people to spend the currency quickly rather than hold it, as holding it incurs a cost.

Step 2: Analyze the relationship between stamp-scrip and local currency

The study mentioned states that local currency circulates 6-7 times faster than legal currency. However, stamp-scrip is a specific type of local currency with added features designed specifically to increase velocity.
Stamp-scrip based currencies are designed with an explicit mechanism (the demurrage feature) to accelerate circulation beyond that of typical local currencies. The need to affix stamps periodically creates a strong incentive to spend the money before the next stamp is required.

Step 3: Determine the likely circulation velocity of stamp-scrip

Given that regular local currencies circulate 6-7 times faster than legal tender, and stamp-scrip has additional velocity-enhancing features, we can expect stamp-scrip to circulate even faster than typical local currencies.
Historical examples of stamp-scrip currencies, such as the Wörgl experiment in Austria during the Great Depression, showed extremely high circulation rates. In the Wörgl case, the stamp-scrip currency reportedly circulated about 14 times faster than the national currency.

Based on historical examples and the design purpose of stamp-scrip, we can reasonably conclude that a stamp-scrip based local currency would circulate at least at the upper end of the range mentioned (7 times faster than legal currency) and potentially significantly faster, depending on the specific demurrage rate implemented.

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