Yes, this requires a centralized authority, but it is impossible to have a pegged asset without one, simply because a trusted entity has to secure and possess the reserves.
Bullshit. Bitshares' bitUSD has held a $1 peg since 2014 without any centralized authority.
How does bitUSD make any sense? You have to put in 2 USD to get 1 bitUSD. The market seems to agree, less than $1 million in bitUSD.
Ummm... this is a half truth or you don't understand how bitUSD works. I'm not sure which one.
You can buy 1 bitUSD with $1 USD (plus a small margin for traders) on Bitshares' decentralized exchange. Since bitUSD's inception the ecosystem's dynamics have been heavily fine tuned and experimented with. Also, the market has since matured greatly with the creation of easy to use market makers bots (such as
https://btsbots.com/), as well as privately developed and operated bots, which people run to automate market making operations for a profit. That has resulted in the margin of buying 1 bitUSD not being more than $0.05 USD for over a year now. As the market matures further, that $0.05 spread will eventually diminish closer to $0.
The only reason you would need to spend more than 1 USD (plus the small margin) is if you are are bullish on Bitshares' value and sought leverage to increase your trading profits by selling the BTS token during or after a bull run. Your statement that you have to spend $2 USD to buy 1 bitUSD is quite misleading. Possibly that was the intent? I don't know...
I found that statement on what I thought was an official bitUSD page, but now I don't find it.
As you state, right now it is 0.05 lower.
If it works, why is the market cap so low?
After doing some looking online, I don't understand how it works. According to this video,
https://www.youtube.com/watch?v=YD8i2Py9Paw, a bitUSD is made up of a variable number of bitshares, such that the value will always be $1. But that does not make sense, firstly it is dependent on the viability of bitshares, second, where are the bitshares coming from to insure a constant value?
If it's dependent on bitshares, then how is it not centralized?