[dragonwriter]

> > Commodity-representative/redeemable currencies cam be created at will

> No they certainly can not. Not without an actual supply of the commodity.

Yes they can. (And there is plenty of historical example of that happening.) Heck, pre-state-monopoly banknotes were essentially a redeemable virtual currency over the currency in which they were denominated which often relied very heavily on this trait.

There is a risk associated with doing so, but that's also true of fiat currency, though the exact failure mode is different.