It's true holding bitassets does expose you to systemic failure of Bitshares. So far it's been working very well though. Bitassets are collateralized by Bitshares, for them to lose their value and become uncollateralized, Bitshares (BTS) has to lose its value extremely rapidly, as in a 60% crash on all exchanges in the space of a few hours. That kind of thing. So it is possible but very very unlikely. Providing that doesn't happen, a buyer of bitassets will always be able to exchange their bitasset for equivilant value of Bitshares as there will always be a short who is required by the rules of the market to cover their position and buy back the bitassets within 30 days. I.e. 1 bitUSD is exchangeable for 1 USD worth of BTS which is then tradable for 1 real USD.
You also earn a few percent in interest/yield by holding bitassets, like a bank account, but one that actually pays interest.
How's the convertibility enforced? Is it centralised - do you have to count on the good faith of humans at any point?
