What I don't understand is why major exchanges continue to give tether their customers money when it's not backed by cash? Would an exchange not be incentivis

What I don't understand is why major exchanges continue to give tether their customers money when it's not backed by cash? Would an exchange not be incentivised to manage the cash themselves and significantly reduce risk for their customers and business? It seems like huge risk for what looks like a minor convenience. Also, very good video on the history and current state of tether: https://m.youtube.com/watch?v=-whuXHSL1Pg https://m.youtube.com/watch?v=-whuXHSL1Pg