[panarky]

Sure, a blockchain provides cryptographic consensus about assets on the blockchain, but it can't control things that are not on the blockchain.

Things like legal contracts in a filing cabinet, bank databases, gold bars in a vault, or how many coins I say are in my pocket.

For all those things, the blockchain can act as a database, but you need to trust someone that the entries in the database correspond to these other things that the database is supposedly tracking.

[JamesBarney]

Which is the entire issue the op asked about, can you verify a party has enough dollars to back a stablecoin on the blockchain.