no backing .. just pegging .. you can also called it a consensus that a bitUSD is worth a USD ..
basically the engine (market) honor those that trade towards the consensus .. thats it .. feedback loop keeps the bitUSD where it belongs .. to 1USD ... or close to (that's the experiment)
It's worth experimenting I guess.. I sort of see it similar to the USD going off the gold standard but still claiming it is.. I definitely feel like it's valuable will never be worth 1 USD, because clearly USD is worth more..
idk, I'm not going to touch it for a year or so.. if it stabilizes, awesome!
When USD went off the gold standard, it meant that is was not backed by gold. This is not the case with bitAsset and this is the beauty of it they will always be backed as long as BTSX has value of corse . Now BTSX value is 55 millions $ so you have a lot of backing and this is only the beginning.
Your gold is btsx, so you can look at it this way : your bitUSD will be backed by BTSX and the price will be pegged to a USD. As long btsx has value your bitAssets will be baked . Now the only question remaining is if the market peg will function as is it is supposed too. But even if it is not working there is a backup plan.