I can see it being fun for a specific campaign, or even for one or two adventures in a campaign, but I think that it wouldn't work well a lot of the time.
Absolutely. It is a specialized campaign style, not a suggestion to replace the default rewards chapter of the DMG
As for your individual points, a comment or five:
My only criticisms are:
1. I makes magic items readily accessible by claiming that losing XP makes up for increased power. That argument didn't work at all in 3.x, and I don't see why that should change. Given that a +1 weapon is essentially equivalent to four experience levels (the number of levels required to get +2 to an attribute) I find that argument difficult to sustain.
2. It discourages altruistic PCs. Even if you allow tithes and donations to substitute for carousing, character advancement is driven by the accumulation of wealth. This style wouldn't work if, for example, you were trying to run a campaign modeled after Lord of the Rings or Star Wars where the ultimate goal has nothing to do with wealth at all. That means you need to structure the campaign around the fact that character advancement requires wealth. That's not going to be every campaign.
3. It requires access to a place to expend wealth during downtime. If you're stuck wandering around the wilderness or plane-hopping, you're unable to advance. If there's a time limit hanging over the PCs head, you're unable to advance. Again, you must structure your campaign to allow for downtime, and allow for the ability to spend wealth -- often absurdly large amounts of wealth as levels increase. You'd be making the Count of Monte Cristo look like a chump.
4. It encourages PvP. Since wealth is transferable and XP isn't, it encourages players to steal from each other, lie about treasure, etc. Great for a pirate campaign, maybe, but not all the time.
5. Treasure disbursing is a lot more difficult for the DM. In 5e, you really only have to think about gold until players have about 2,000 gp each. At that point, they can essentially buy everything they could want. You can let them find troves with tens of thousands of gp, and there's really no problem with that because it doesn't translate directly or easily to more character power. This eliminates that benefit.
1: Come on, even a single level is EASILY worth much much more than a measly +1 to your attacks. That doesn't mean there is a problem, or rather, a challenge, only that's it's pretty much the converse of what you're arguing.
The real issue is if you can speed up your leveling by selling off all your loot. That is, if the value of your loot (even if the sell price is half the buy price) is considerable compared to the xp you need to level up.
The solution is that you might want to tweak rewards to yield more cash relative to (the value of) items. Of course, the old skool solution is to simply say "you can't sell items" or rather "nobody has large amounts of gold lying about so they won't pay much for your stuff. Barter on the other hand..."
Concrete example:
If you sell your magic sword (market price 1000 gp) you get:
25% cash: you get 250 gp (which you then can spend for xp)
50% permanent items: you get items as if you spent 500 gp
75% consumables: you get potions, scrolls etc as if you spent 750 gp
2: Yes, xp-for-gold is unabashedly old school. Your party is venturing forth into the unknown, to explore the wilderness, to find the loot, and maybe slay a few Dragons. A good time will be had by all - including those who lay down their lives in the pursuit of fame and fortune!
3: Yes, xp-for-gold is a sandbox style. You need a map with a couple of dozen features. Where is the Goblin caves? Where does the Manticore lair? Where do the Ogres roam? Tucked away in one corner is Home Town (which might actually be called that!), which slowly grows as the heroes carouse away their ill-gotten gains!
4: Hard no. There's no need for in-game rules against theft and murder because you simply don't play with players that can't cooperate, or don't understand the spirit of the xp-for-gold campaign style. The unwritten assumption is that you don't steal from your fellow party members, any quest givers, or the shopkeepers back in town. You do try your hardest to bring back fallen comrades... or at least their belongings
5: Not having much of anything to purchase for gold (past level five or so) is actually 5th edition's biggest drawback, so I respectfully disagree.
XP-for-gold works best if you have a robust magic item economy, with prices based on actual utility for adventurers, which 5E definitely does not have.
Why? Because if you don't offer magic shoppes with compelling inventories, the whole idea of "should I level up or buy this juicy item" falls apart.
Here's a concrete example. For my Tomb of Annihilation campaign (not a xp-for-gp campaign) I created all the magic shoppes myself:
https://www.enworld.org/forum/showt...-fabulous-bazaars-of-Port-Nyanzaru-and-beyond
I relied extensively on Sane Magic Prices as well as Pathfinder SRD to do this. 5E has been an utter letdown in this regard.
