I would like to understand this concept better that I've seen referred to numerous times, because I'm just not getting what is meant by it. Maybe somebody can help make this concept click into place for me?
My starting point is that the holder of a bitAsset requires some assurance that its value (measured against external assets) will track the value of the real asset. Their key concern is that when they sell the bitAsset, an asset within the system, they receive enough funds that they could buy the real asset outside the system, should they wish to.
So this requires an exchange price of at least one asset inside the system to at least one asset outside the system, in order to make this calculation. This is what I understand as an external or exogenous price feed.
It's been said by many that when liquidity is significant inside the system, that we can move toward an endogenous price feed.
When people refer to an endogenous price feed, being "within the market", what exactly is meant by this? Does this involve a comparison of only the values of tokens that all reside inside the system? If so, I can't see how this provides any information about how any internal token is to be valued outside the system.
Am I understanding the concept correctly?