It's understandable since this topic is bit old, but now you don't have buy products when Bitcoin is higher to manage Bitcoin's volatility. You can convert Bitcoin to stable crypto currencies and then buy back btc. It's safer option and you don't have to force yourself to buy some product.
I think you misunderstood the proposal. It tries to solve (or at least, mitigate) a problem that hasn't be solved by anyone: stabilize the price of Bitcoin or any other cryptocurrency, using products to "back" it.
"Stable" cryptocurrencies (e.g. Dai, BitUSD, Tether), while some of them are interesting, all of them have one of two fundamental flaws:
1) if they're (fairly) decentralized and based on a "pegging" mechanism, their peg could be attacked by manipulators, profiting from shorting it after the peg broke (there is no way to completely prevent that, but for BitUSD and Dai you'll need to be a big whale or a cartel)
2) if they're centralized, their operators could run away with your money.
And if you're using them as "hedges" against Bitcoin's volatility: You can
never really know if the market really has turned, or if the bears continue to roar
Short term volatility aside.
The goal of this proposal is not to provide a peg, but to reduce volatility of traditional cryptocurrencies like Bitcoin providing a "backing" that gives people the chance to preserve value even if there is a crash. The cool thing about it: If the "backing" is done with digital products (e.g. music, video games ...) then even in the event of a 90% crash the merchant continues to make profit like I explained in the second post with the metal band.