I don't like the idea of having a peg, because that tends to imply "here are two different coins you can trade separately" which is usually the case for other pegs.
It is true that it is not a 1:1 connection and is not dependent on a third party (BitGo) as in the case of pegged tokens, but any Orchestrator will receive a slashing reward as long as this equation is adhered to:
BTC secured< ((4n^2)*s)/9 where n = number of signers and s = stake size per orchestrator
With this equation, we can say that if there were 5 signatories, each staking 5 BTC, then the maximum “safe” amount of Bitcoin in the multi-signature would be ~56 BTC, which is not good since their total Bitcoin is 25 BTC.
But if there are 30 signers each staking 30 BTC, you will find that the “safe” amount is ~12,500 BTC while the currencies being bet with are 900 BTC.
So the more Orchestrator nodes there are, the smaller the probability of having a large number of malicious Orchestrators in the same multisig.
But the question is what would anyone pay to run an Orchestrator node as income can only be earned from transaction fees which are supposed to be cheaper than on-chain fees.
This is a good explanation
https://blog.lopp.net/an-introduction-to-spiderchain/, including the equation above