At the end of the day tether will still exists and remain at $1 even if it is a fractional reserve rather than 1:1 . Heck the money in our banks are fractional reserves too but that does not stop everyone from mass panicking and withdrawing.
If it's fully backed and it will always be stable because it's pegged with the commodity that has already used to backed tether with 1:1 ration. Sometimes the flash dump can make it goes even lower than the 1;1 rate caused by the market has no liquidity but it looks like everything is stable right now.