I don't think it is Balkanization at all. I think it merely provides a choice, and I like the ability to choose.
Besides, you could make the same argument about BitCoin and other cryptocurrencies, and they have done nothing like Balkanizing our country.
As a practical matter, if a state issues currency, does a local business have to accept? And nationally? Can you imagine a cash register having to keep multiple sets of currency in the till?
Who gets rich out of this? Money exchangers?
What probem does this solve? Ron Paul and others have long offered complaints about the Fed, why not fix that instead?