It's not what you call "exponential" (I would just call it unstable) because of the haircut rule. HBD gradually loses its backing if the HIVE drops in price too much (more than 30% of Hive market cap). So it has a well defined backing (which may be below 1 USD) and doesn't require unlimited increases in HIVE (your "self-fueling cycle") once that point is reached. Above 20% of Hive market cap, most mechanisms for creating HBD will also stop, though this doesn't really do much to ensure the ratio stays down, since the price of HIVE can still fall.
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