Tether has gigantic red flags including not being able to actually exchange it for dollars even though it is pegged to dollars. It's so brazen it's hard to even believe it.
Tether has a purpose - to be a savings account is not that purpose.
Hundreds of millions of people do this every day around the world without issue, because this is a solved problem.
You cannot withdraw your Tether balance. They literally do not allow that. The best you can do is get an intermediary coin that some places might let you change into cash or another crypto.
But it's at least possible to withdraw from banks. Redeeming Tethers is impossible.
Tether has never been independently audited, whatever non-liquid reserves/investments they have are not backed by an insurance policy. It is not a fractional reserve. It's a con artist's idea of "Hey, I can just open a bank, take 80% of the deposit money, do 'things' with it, and claim I am running a fractional reserve."
In Tether, only the original investors get profits, which they get form everyone else investing in Tether, so this is an entirely different type of scam.
The scheme to create a token that is supposedly worth $1 to buy BTC and other coins off exchanges and then selling those coins for real USD.
For anyone interested in the origins of Tether, look up Bitfinex hack.