If Tether is redeemable for USD on demand, then Tether sounds suspiciously like some sort of a bond that is evading regulation. Maybe my terms are laymenesque, but I think my point still stands.
> "There is no contractual right or other right or legal claim against us to redeem or exchange your Tethers for money."
Edit: Oops this has been updated to:
> Tether reserves the right to delay the redemption or withdrawal of Tether Tokens if such delay is necessitated by the illiquidity or unavailability or loss of any Reserves held by Tether to back the Tether Tokens, and Tether reserves the right to redeem Tether Tokens by in-kind redemptions of securities and other assets held in the Reserves.
> Any individual who is a U.S. Person and any entity that is a U.S. Person is prohibited from using the Site or any Services, including but not limited to using a Digital Tokens Wallet on the Site
Maybe the question is why do some big exchanges still work with tether? Must be worth it to them!