It's not obligated to redeem your USDT but it is obligated to redeem it for its customers (exchanges mainly). At least on paper it works like this: 1)exchanges

It's not obligated to redeem your USDT but it is obligated to redeem it for its customers (exchanges mainly). At least on paper it works like this: 1)exchanges need Tether so they get it from the Tether inc. while depositing equal amount of USD with them 2)if they don't need some of it anymore they can redeem it We know depositing USD part never happens. It's likely some shady paper or more likely some promises are deposited instead. It's also very likely they buy BTC with freshly printed Tether (not directly but through some of their other entities) causing constant buying pressure for BTC and other cryptocurrencies. This may just work if enough people FOMO into crypto seeing the skyrocketing price as then the gang can sell their BTC for real USD.