I think they'd just prefer no one speculating on Tether at all. If Tether had a bunch of people actively trading the USD-Tether pair, it would be much more exp

I think they'd just prefer no one speculating on Tether at all. If Tether had a bunch of people actively trading the USD-Tether pair, it would be much more expensive to keep the price fixed. By keeping the price volatility extremely low, they discourage speculators from trading, since they don't stand to make a profit without price movement.