How to create a cryptocurrency backed by an asset (say a fiat currency or physical commodity) I want to create a cryptocurrency for use between myself and a collection of friends (as a proof of concept).

Assuming that I want to peg my cryptocurrency to (say) the Chinese Renminbi and the price of Wheat, what would be the steps in creating such a cryptocurrency?
Value is a subjective matter and as such you can't make something be worth something else.  

As such, your best bet is to create a cryptocurrency and have all participants agree that it's worth the desired asset. 

Every other scheme with oracles and "smart contracts" and whatnots are just an iteration of the previous aforementioned social contract between the participants of the network. 

If you still want to try to develop something I'd advise you to take a look at MakerDAO and DAI from Ethereum, here. They are working on creating a stablecoin without any of the stable asset. Be advised that any people (me included) have doubts about that.