What I don't think most folks realize is that USDT is heavily centralized. They have an extensive 'blacklist' of tokens they've frozen, and they add to it regularly. Far more so, I believe, than any of the other stablecoins. They were the first (only?) to freeze tokens coming out of the Poly hack. [1]
I believe they even forced a change to Omni to support blacklisting after they were 'hacked' [2] a few years ago (scare quotes because it was never investigated or IMO resolved). [3]
It's highly antithetical to the Satoshi white paper.
If Tether gets shut down and their leadership banged up, I strongly suspect custody of the network will fall with the DoJ and they could, at their discretion, freeze all tokens pending full AML/KYC and source-of-funds of holders. Whether this is a credible fear or not, the ensuing fear and chaos would almost certainly break the $1 peg, especially once their exchange friends stop supporting the peg and turn states witness.
I believe they even forced a change to Omni to support blacklisting after they were 'hacked' [2] a few years ago (scare quotes because it was never investigated or IMO resolved). [3]
It's highly antithetical to the Satoshi white paper.
If Tether gets shut down and their leadership banged up, I strongly suspect custody of the network will fall with the DoJ and they could, at their discretion, freeze all tokens pending full AML/KYC and source-of-funds of holders. Whether this is a credible fear or not, the ensuing fear and chaos would almost certainly break the $1 peg, especially once their exchange friends stop supporting the peg and turn states witness.
[1] https://www.coindesk.com/tech/2021/08/11/returned-funds-blac...
[2] https://www.coindesk.com/markets/2017/11/21/tether-claims-30...
[3] https://github.com/OmniLayer/omnicore/releases/tag/v0.3.0