RE: The Power of +5%
It would simply be defined as a new price feed on the BitShares platform and would then work like all the other market pegged smartcoin assets there.
Of course, the underlying assumption is that the demand for such a coin would draw so much BTS out of circulation that its percentage gain would zoom far beyond the Sumo.
At first glance it doesn't look like you would want to short something like this, but remember, a whale would be shorting the Sumo against a zooming BTS, not the CPI or anything else.
This plot is just pegging the Sumo above the dollar. If it were pegged to a basket, presumably the wiggles would be smoothed out and pegging to the strongest currency at any point in time would maybe eliminate all dips.
But, we just need something simple to explain that is better than what most people have, so I'm thinking sticking with the above definition is a good compromise.
Your actual mileage may vary.
All the other market pegged smartcoin assets there do not correspond well enough to the current FX rates, in some cases the difference exceeds 5 %.
But low liquidity and high spread makes the arbitrage impossible - Sumo will need a market maker, so the investors see the profits in real life, not only on the paper.
I think there are no mathematic tricks which could solely guarantee the peg, to say nothing of any growth :-)
As a collateral the dream coin will need a working business with ROI not less than 5% in terms of USD
Correct. No mathematical tricks. The double collateral for the smart contract guaranteed growth are placed in escrow by the hypothetical whale who takes the only risk. The whale is betting that her ongoing investment will increase the value of the ecosystem enough to give her a lucrative profit by offering a useful product insured by escrow locked up on the BitShares blockchain.
This is the same principle used by Disney World when they bought up tracts of swamp land in Orlando and then drove up its value by decades of investment in that ecosystem.