In my opinion USDT is crypto's achilles' heel right now. While its market cap is comparably small, it still has quite respectable trading volume and is permeating pretty much every part of the market.
i don't think usdt's lack of real money is what'll ruin everything. it's the legal hack that holds it all together.
as soon as any state takes a closer look and can be bothered to figure out it's a giant banking diligence avoidance scheme then all of the exchanges that carry it will be forced to give it up.