I think Dev mentioned that he is trying to make it "undumpable" that would automatically attract more vendors including Ebay
Yea. I saw that.
What he's proposing to do is control the price by limiting the supply to market at any given moment.
The problem is, there are two components to the price equation and supply is only one of them. You don't create demand by limiting the supply - they are independent of each other. A peg needs to work from both sides of the price equation - much like the Bitshares model where a long and a short position are engaged in order to bring the currency into existence around a fixed reference rate to another currency.
All the same, this is the exact type of thing I'm interested in fleshing out. It's as vague as mud right now and could do with quite a bit of illumination.
I think what he is trying to do is control the supply. As demand rises he'll increase the supply. It's the only way to make sure that price doesn't jump around and becomes volatile. Demand can't be controlled per say because it comes from the market but if supply>demand then price will collapse. It makes sense economically & logically to keep supply restricted till demand is there.