That’s a fair criticism Anjana. The reason for the “hand waiving” is that this a very introductory post and to include details of these mechanisms would have been confusing. That being said, our team has been working on this for three years and has created one of the most impressive suites of smart contracts in the industry. I’d encourage you to check out the whitepaper and purple paper (linked below) and head over to chat.makerdao.com with any questions!

Whitepaper: https://makerdao.com/whitepaper/DaiDec17WP.pdf

Purple Paper: https://makerdao.com/purple/