Imagine we have an intrade-chain denominated and paid in bitcoin (so not a good place to short BTC). The chain makes the escrow, but it cannot generate bitcoins out of nothing, they're
real bitcoins from the btc network.
What I don't get is how you get from the intrade to an asset that can be sold at any moment for the current price (in BTC) of a barrel of oil.
How is that done with bets? How many parts are necessary?
I don't know how to do it even with a stable currency.
I think that the intrade idea was suggested as an alternative to holding "barrel of oil" type contracts. If speculation worked using binary options like intrade uses, you probably wouldn't be buying and selling bitcoin-backed contracts.