Fundamentally, you cannot exchange FLOAT for any underlying collateral. However, we will have a fund to stabilise the price of FLOAT when it is volatile. This fund is called the ‘Basket' and contains an approved set of cryptocurrencies.
To grow the Basket is simple. When arbitrageurs buy FLOAT from the protocol during auctions, they have to pay for it with one of the approved cryptocurrencies. Once stored in the Basket, they are used at a later date to support the price of FLOAT if it is ever below its target price. Initially in V1 of Float Protocol, the Basket will only contain ETH, with more able to be added by a governance vote.