If you hold a HERO, you can "request settlement," which means you give up the HERO and get paid an equivalent number of BTS (measured by the feed price). So even if many many people borrow HERO into existence, the excess supply can't push the price below the feed price because people would buy the low-price tokens and settle them for a profit.

There is extremely high demand below the price feed because the network enforces the price feed as a floor.

We'll see about the premium. The token still doesn't have much liquidity, so it's hard to judge yet.