> I think you've got it backwards. The arb would be people buying it at $0.97 and hoping it repegs to $1, not redeeming That's not an arb, that's just buying l

> I think you've got it backwards. The arb would be people buying it at $0.97 and hoping it repegs to $1, not redeeming That's not an arb, that's just buying low and selling high at a later date. The arb is buying something for $0.97 but then getting $1 back, minus fees. The more people doing that the closer the peg stays to $1 through supply/demand. That's the whole basis of how a peg is maintained, arbitrage players provide huge amounts of liquidity and make small margins for doing so.