They used to, for several years, until they were pressured to prove it and could not (27:05).

https://youtu.be/-whuXHSL1Pg

> Bitfinex and Tether recklessly and unlawfully covered-up massive financial losses to keep their scheme going and protect their bottom lines,” said Attorney General James. “Tether’s claims that its virtual currency was fully backed by U.S. dollars at all times was a lie.

https://ag.ny.gov/press-release/2021/attorney-general-james-...

Now they do (previously they claimed 1:1 with actual dollars in a bank account, but failed to demonstrate that). But that 80% "Commercial paper" is suspicious as hell, considering it would make up more than half the total market for said paper (so 'liquid' is already questionable), and no-one else in the market has heard of them.

They're now claiming no commercial paper. I'm not sure if that's more or less suspicious.