| Entymal |
The important thing there is that it can't be used to exceed the level of the highest level character in the party. That limits abuse.
One significant disadvantage is if the GM gives specific xp rewards to individual characters, the others can use downtime to claim it as well.
I use downtime extensively in my campaigns. Earning XP takes away the sting of missing a session, character death, party splitting, or anything else that creates experience differences.
On the other hand, characters who use their downtime for other purposes get advantages the XP earners don't, such as maximized HP, crafting time, and earned capital.
In my experience, the trick is to make economics functional and valuable in your game so that there is a meaningful choice in how downtime is spent. They either live the high life and have nice things, or spend time working and training. It adds a layer of realism.