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> Basis is designed to keep prices stable by algorithmically adjusting supply. When demand is rising, the blockchain will create more Basis. The expanded supply is designed to bring the Basis price back down. When demand is falling, the blockchain will buy back Basis.

So exactly how counties do/did with their foreign currency reserves. Hint - it can and did end up blowing up in spectacular way.

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Out of interest, what do they use to "buy back Basis"?

Bonds are auctioned off that can be converted 1:1 to coins the next time the supply increases.

They auction off a sort of binary future that either converts to Basis in a future event when they're increasing the supply, or expires worthless if no such event occurs in a set amount of time (5 years, I think).

> Hint - it can and did end up blowing up in spectacular way.

Very true. See George Soros and the Bank of England for a famous example.

https://www.investopedia.com/ask/answers/08/george-soros-ban...

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