USDC has monthly "attestations" of their assets. This is less than an audit but it isn't nothing: https://www.centre.io/usdc-transparency

I don't think even banks do monthly external audits.

USDT does quarterly external reports: https://tether.to/en/transparency/#reports

Because they've claimed it and we have no reason not to believe them, unlike USDT which we have many reasons not to believe them.

If your model is to trust entities until there's a specific reason to distrust them, I've got a billion dollars in USDLMM to sell you. Tether is larger and has been subject to more investigation than their competitors.

(Don't get me wrong, I assume everyone in this space is some combination of fraud, ponzi, and money laundering)

Tether has not survived those investigations.

My model is the same as your model, you're just making assumptions I'm not.