The whole premise of Tether is that it's backed 1:1 by fiat USD so if they're not then they're lying to Tether users, quote from their website
"Every tether is always backed 1-to-1, by traditional currency held in our reserves. So 1 USD₮ is always equivalent to 1 USD."
I see. That is important then. I wonder if another stable currency could upend this requirement though in the manner that I described above.