I'll let Ebi demonstrate this method, as it's one I've never used myself.

My impression is that the main advantage of this technique is that it imparts less twist to the rope. It's also much faster to make the bundle. The disadvantages are that it takes much longer and both hands to undo while tying; and that it's more likely you'll lose the center and need to re-flake the rope before using it.

I've noticed that this method of storage is more popular among people who practice styles of rope that discourage joining ropes during a tie (joining requires holding tension on the last rope until you've attached the next one). One saying in this school of thought is that "a rope should be a like a sentence", where it finishes its thought, is completed with punctuation, and there's a pause before the next one begins. In that context, since you have a pause between ropes anyway, it seems only natural to take your time (and both hands) to undo the next hank of rope.

Personally, I would find speaking very awkward if all my sentences had to be the same length, forcing me to end them early if I'm out of words, or mumble nonsense at the end to pad them out. But everybody enjoys different types of creative constraints; YMMV.