"In theory this HBD is not for sale, but if the price of HBD goes above $1 on the internal DEX, the @hbdstabilizer will start selling some of it on the DEX."
So it's for sale. :-)
What is the mechanism for sustaining the HBD price around the dollar? Do they sell HIVE and buy HBD when HBD <1$?
Yes from the hbdstabilizer and the dao funds. Additionaly there are the conversions. The blockchain will give you a 1$ worth of hive when converting.
But this goes only until the debt limit is reached ... after that hbd is no longer worth 1$ by design