How is this different from decentralized currency with a fixed/limited quantity? I wonder what Friedman’s opinion would have been in todays Bitcoin/crypto environment.
It's not much different. The primary reason why cryptocurrency aims for a limited supply is to eventually remove the politics around who gets newly created money. Friedman couldn't have imagined cryptocurrency, so had to settle for the next best thing of market interventions that were at least mostly automated, most of the time. This isn't that great because of course someone still controls and programs the computer.
There's a couple of technical reasons Friedman thought the money supply had to keep increasing:
1. he was a subscriber to the deflationary spiral theory, which doesn't make much sense as a concept but has a lot of subscribers in economics
2. dollars and similar currencies have very limited resolution because most payment methods can't handle fractional cents, so if one cent becomes too valuable you start to destroy products and services for which the best price is less than that. Bitcoin doesn't have that problem to anywhere near the same extent because the resolution of the currency is much higher, and the software can all handle very small values.
It may be what he'd have wanted: something fully automated.
As for the fixed quantity, it's just a property of some coins: other don't have this restriction/feature (depending on how you like it!)
If you think it's a desirable feature, it could also be fully automatized, and not just by a time trend (ex: grow by k% if the number of transactions grow by x%)
There's a couple of technical reasons Friedman thought the money supply had to keep increasing:
1. he was a subscriber to the deflationary spiral theory, which doesn't make much sense as a concept but has a lot of subscribers in economics
2. dollars and similar currencies have very limited resolution because most payment methods can't handle fractional cents, so if one cent becomes too valuable you start to destroy products and services for which the best price is less than that. Bitcoin doesn't have that problem to anywhere near the same extent because the resolution of the currency is much higher, and the software can all handle very small values.