I agree with you, however I'm the only user on my laptop so for the few milliseconds that oathtool is running it's not a problem for my use case.
$ time otp aws
otp aws 0.00s user 0.01s system 98% cpu 0.015 total
Even back in the 90's Mysql was able to hide the CLI supplied password from the process list. It would be cool if oathtool was able to do the same.