It's suspected (not proven) that the majority of the trade is actually wash trading to pump the price of Bitcoin. Additionally, an exchange trading in USD will be exposed to US regulation as a result of that, even if not situated in the US--if you're trying to evade US financial regulations (or sanctions), you really don't want to touch any USD whatsoever.

The exchanges are able to buy USDT for less than $1 and use it to trade against customers. Big advantages to them to use it, and also they don’t need banking relationships to acquire it this way.

FTX and Binance among biggest customers. Likely offering commercial paper to Tether in exchange for the USDT. Already established that Tether made crypto backed USDT loans to Celsius.

Here’s Tether’s customers:

https://protos.com/tether-papers-crypto-stablecoin-usdt-inve...