People unhappy with USD can always use USDT, opportunistically printed in hundred million "dollars" equivalent per month by 3 semi-anonymous guys in non-extradition offshore and which was dropped like a hot potato by the only auditor company who even considered auditing this scam. There is only one small flaw in this plan - for some weird reason not many people are rushing to adopt this toilet paper "currency".

Well, those billions of fake dollars are being used to buy Bitcoin, which props up its price, which attracts excited retail investors to buy Bitcoin — so in fact people are rushing to buy the USDT toilet paper, they just don't know it.

Or you could say they are blocking obvious pump-and-dumps.

Libra is allowed to exist though. Or I suppose it doesn't compete with USD as it will be tied to fiat?

This is only my guess, but it should be so much easier to control and regulate Facebook's product rather than Telegram's, right?

Libra is not selling rights to non-existent tokens. That’s why it’s not a security while TON is a security. No one banned TON, they just said that if you fundraise by sale of tokens then said tokens are securities. Which is a fairly straightforward truth.

It does from a short sighted, tyrannical, perspective.

It's not like I'm defending them. Just trying to understand the real reasoning behind this decision.

I highly recommend that you read the original SEC complaint. It lays out the reasoning quite clearly.