Tether is one of the weakest stablecoins in terms of regulatory compliance and general community trust.
In other words, most arguments I hear against stablecoins apply narrowly and specifically to Tether, yet people tend to use those valid arguments against Tether to straw-man the entire asset class. Popularity and volume have nothing to do with that.
I would say that if 90% of stable coin transactions are through tether then they have the general trust of the community. It's as plain as day, and you seek to dismiss it as a "side show" when it's really the main act.
Pro crypto arguments these days have come down to basically "You're not allowed to make that argument. It's early days. There are no good critics..." and now "you can't conflate my argument."
You said that you don't trust stablecoins because one particular stablecoin is untrustworthy. That's a classic strawman, plain and simple.
You took down the Tether strawman, while pretending that you took down the entire concept of stablecoins.
This conversation is going way off track from your original claim that you don't trust stablecoins. Your perception of the community's perception of Tether is neither here nor there.
"Reputational Risk" is a term bandied about in the banking industry when it comes to holding people's money.
While USDC does indeed look better, the management failure of holding corporate bonds in lieu of treasuries and dollars would have triggered an audit in a bank, and would have been big news.