Because the public’s demand for currency expands with the growth of the economy, it could only be accommodated in this regime by some other source of cash such as provided by RBA open market operations. Failing this, there would be continuing upward pressure on interest rates and economic contraction.
I have spelled this out in some detail because proponents of the "leave it to the market" view often do not have a clear idea of what their position really means. But if they mean simply ceasing Reserve Bank operations, and leaving interest rates to the market in that sense, then it is clear that such a 5 system would not be workable.