No they are not. That rationale is a coping strategy at best and deliberately misleading at worst.

Tether is NOT a bank. They are not regulated and have no guarantee that depositors will be paid back. They promise a 1-1 backing and instead of people holding them to their promise their supporters desperately try to compare it to moderns banks.

No. Tether is not a bank. It is not doing fractional reserve banking. It is committing fraud. It’s that simple.