When I think of asset-backed crypto, usually don't look at those backed by USD or another currency... I am looking at the possibility and dominance of a cryptocurrency backed by real-world assets such as real estate, precious metals, and other commodities. USDT aside, how will the world fare with an asset-backed cryptocurrency?
The problem of assets backed crypto is that we still need a trusted central (3rd) party to manage the assets, which is a common enterprise, by definition. There is nothing new about it, and you can learn from the history of why it is full of shenanigans. Hence, it won't ever be used as currency.
For example, coins backed by gold, or commonly referred to as Digital Gold Currency (DGC).
https://en.wikipedia.org/wiki/Digital_gold_currency#ProvidersYou might see popular names like Liberty Reserve is now defunct.
* In FIAT, you trust the Government;
* In POW crypto, you trust the math;
* In assets backed coins, you trust the issuers.
Gold is a commodity, meaning it's pretty much uniform, and yet the trusted 3rd party still showed incompetence. How can they manage such complex assets like real estate?