* Take the median of the exchange rates from a set of feeds, with that set chosen by vote of holders of the coin (I can personally see this having some conflict-of-interest issues)
* Use what they call a "Decentralized Schelling point scheme" - have coinholders vote on what they think the exchange rate was in a recent time interval, use the median vote, then reward voters who were in the 25th to 75th percentile.
The authors seem to view the third option, with some engineering of the incentives, to be ideal; but I'm skeptical of a system that gives holders of an asset the ability to change the value of that asset. I would honestly prefer the use of a trusted authority - at least that way you have a very clear delineation of what the central authority is supposed to do and can easily audit whether it is doing its job.
